U.S. to stay engaged in Mideast despite domestic energy boom, says top official
At Munich Security Conference, Carlos Pascual, special envoy for international energy affairs, says U.S. will remain committed to security, peace and stability in the Middle East.
A top U.S. energy official pledged Friday that the United States would stay engaged in the Middle East even if it nears energy independence thanks to an oil and gas bonanza at home.
The technique of fracking has brought "a radical change in the position of our country from the perspective of energy security," said Carlos Pascual, special envoy for international energy affairs.
But he stressed that "all of these changes in U.S. energy production do not change in any way our commitment to global security, to peace and stability in the Middle East."
He was speaking, alongside other officials and industry executives, on a panel talk on the U.S. shale gas boom and "the changing geopolitics of energy" at the Munich Security Conference.
U.S. domestic energy output has skyrocketed in recent years thanks to fracking, where a high-pressure mix of water, chemicals and sand is blasted into deep rock layers to push out oil and gas.
The International Energy Agency has predicted the United States could become the world's biggest oil and gas producer within five years and be energy independent within 15 to 20 years.
Europe has so far shied away from fracking, and France has declared a moratorium, amid fears it can contaminate groundwater.
Now some U.S. allies worry that, if the United States continues to ween itself off Gulf oil, it might also lose interest in policing the volatile region where it has fought bloody and costly wars.
A recent study by the German intelligence service said that, for example, Iranian threats to close the Straits of Hormuz, a key route for tankers, would lose some of their punch for the United States.
Pascual said the fracking boom had been dramatic. U.S. gas production had risen by 25 per cent, and oil production by 30 per cent, in the past six or seven years, he said.
"In oil it has reduced our import dependence from 60 per cent of our total consumption to about 40 per cent at the end of last year, and it's projected to go down to almost 30 percent by 2014."
But he stressed that the United States would have to stay engaged in the Middle East, even if just out of self interest.
"We're dealing with global commodities," he said. "When there is instability or insecurity in any part of the world, it drives up the global prices of those commodities, and we pay for it at the pump."
He said that, for example, shortages during the 2011 Libya conflict drove up oil prices from 85 to 130 dollars per barrel.
Speaking on the same Munich panel, Royal Dutch Shell chairman Jorma Ollila agreed that "it is hard to see a scenario in which the United States abandons its interests in the Middle East."
"The European Union and Japan are key political allies which will continue to be highly dependent on the Middle East for oil," he said.
Ollila also urged European countries to be open to fracking, saying that "Europe runs the risk of running into competitive disadvantage if it continues to dither."
As Germany switches from nuclear power to more wind and solar energy, he said, gas "can serve as a backbone fuel" because it "complements wind and solar power as a low-carbon alternative power source when the wind doesn't blow and the sun doesn't shine."
The energy executive said "the shale revolution is poised to become global," with China, Latin America, Eastern Europe, Indonesia, Australia and South Africa all believed to have large reserves.
"Some reports suggest China may have more shale gas than the United States," Ollila said. "We will know for sure in about two or three years, because a lot of work is going on in China as we speak."
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