President Trump will call for 'US dominance' in energy as part of 'Energy Week'
The media will never give President Trump credit for the strategic masterstroke he has orchestrated, robbing power from OPEC, Russia, and Venezuela while enriching the United States and creating countless high-paying jobs. So he is slated this week to call for an attention-grabbing goal, using the vocabulary of power, not diplomacy: "dominance." Jennifer A. Dlouhy of Bloomberg reports:
Donald Trump will tout surging U.S. exports of oil and natural gas during a week of events aimed at highlighting the country's growing energy dominance.
The president also plans to emphasize that after decades of relying on foreign energy supplies, the U.S. is on the brink of becoming a net exporter of oil, gas, coal and other energy resources. (snip)
Trump's theme of "energy dominance" marks an evolution. For years, the catch phrase of choice has been "energy independence," as politicians and industry officials sought to highlight how a new era of abundance was helping the U.S. wean itself from foreign sources of oil and natural gas.
That was in turn a dramatic change from the 1970s, when former President Jimmy Carter turned down the White House thermostats and used a televised address in February 1977 to urge consumers to conserve energy amid a permanent "shortage." After that, federal energy policy became rooted in the view that oil and gas were in short supply.
"Trump is reorienting our national rhetoric toward 'dominance,'" said Kevin Book, analyst with ClearView Energy Partners LLC. "Captives crave independence; competitors strive to dominate. It's a shift from getting by to getting ahead."
That "dominance" is both real and long-lasting. Another Bloomberg article by Julian Lee presents a good account of OPEC's struggle to remain alive. Its members have cut production but still cannot raise prices because frackers have so rapidly increased production.
The most telling portion of the article captures the essence of American strength: the innovative and aggressive cost-cutting of frackers (and others).
The oil industry has responded to the price slump by slashing costs. Projects that needed $100 crude to break even have magically been redesigned to be profitable at half that level.
OPEC has completely misjudged the North American shale industry and seems not to understand how it is still evolving rapidly. It's a little like trying to explain the internet to my 85-year-old mother, or my 12-year-old daughter trying to explain social media to me. As consultant Morten Frisch tells me, drilling horizontal sidetracks from abandoned wells in the Permian Basin is yielding a 91 percent internal rate of return on a $7 million investment and delivering 1,500 barrels a day of crude. He predicts large production increases from vertical wells in previously produced areas in the Permian.
Having failed to use the good times to invest for a future of low oil prices, OPEC is facing a crisis of old age. It is falling apart internally, confounded by the world and increasingly irrelevant.
One of the key driving forces of the world economy and geostrategic power is the energy revolution brought to us by the petro-industrial-academic complex. They are heroes and get far too little credit for what they do for America. A growing energy export sector could be the basis for major job creation.
It is true that President Trump did not invent the fracking revolution, and that President Obama did not fatally hinder its development. But Trump did understand the geostrategic implications, and is pushing them to the max, while also pleased at the jobs that will be created.