Energy Geopolitics in 2019

2018 was a significant year in terms of energy geopolitics: The United States once again was able to regain its title as the world’s largest producer of oil. For much of the 20th Century, the United States had been the world largest producer of oil and that dominance lasted until 1974 when it was overtaken by the Soviet Union at the height of the Cold War. The Soviets were subsequently passed by Saudi Arabia in 1976 – from that point onwards, it was the Saudis who were to dominate the oil market, which they have done for the last four decades. The manner, in which the United States overtook Saudi Arabia’s position, necessitates a broader consideration of the geopolitical change in the global energy markets, and what that means geopolitically in terms of US engagement with the Middle East. The exploitation of shale rock in the United States has been nothing short of revolutionary in the energy sector and this allowed the United States to inch ahead of Riyadh as the world’s largest producer of oil. The broader geopolitical implications of the shale revolution in the United States is that it has enabled “energy independence” to be achieved. Whilst global supply, demand and geopolitical risk all impacts the price of West Texas Intermediate (WTI) and Texas Sweet Light oil, which directly impact the US consumer, what is important here is that by the US achieving energy independence and becoming the world’s largest producer of oil, it has had an important psychological and political impact which has implications. The significance of this shift should not be [Shutterstock] underestimated, and will be considered here through the lens of US foreign policy and its strategic interests in the Middle Eastern region.