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Economic Outlook: Self-sufficiency soon

Monday, November 12, 2012 9:52 AM


Talk about a sea-change in the global economy, the International Energy Agency said the United States will be energy self-sufficient in less than 20 years.

The 2012 edition of the "World Energy Outlooks," includes predictions that turn some long-held assumptions upside down.

Not only will the United States affect "a sweeping transformation in oil and gas production that will affect all regions of the globe," the report said, but "the potential exists for a similarly tranformative shift in global energy efficiency."

"We can achieve energy savings equivalent to nearly a fifth of global demand in 2010," said IEA Executive Director Maria van der Hoeven in a statement.

"In other words, energy efficiency is just as important as unconstrained energy supply and increased action on efficiency can serve as a unifying energy policy that brings multiple benefits," the director said.

And won't this be helpful if the United States doesn't collapse into a stagnant economy as this miracle of energy realignment takes place. As that implies, there are assumptions that the United States will not just crawl toward energy self-sufficiency, but at least improve its economy at a reasonable pace. And, of course, as the energy flow reverses itself, the economic advantages will accumulate as well.

On the job front, erase a net loss of $10 billion to $15 billion per month spent on imported oil and the United States drops its monthly trade deficit from roughly $45 billion per month to $30 billion to $35 billion.

That's real dollars that will stay in the U.S. economy, giving the gross domestic product a bump of 1 percent to 2 percent and create 150,000 to 250,000 jobs per month.

And all we have to do is not blow it. This scenario is already on its way, the agency said. Furthermore, if the door is open for further oil development or natural gas extraction or pushes further with wind power, solar power and electric cars, the gains could easily improve.

At the current pace "the United States becomes a net exporter of natural gas by 2020 and is almost self-sufficient in energy in net terms by 2035."

There is another psychological possibility here. Politicians do not like to set goals that are impossible to achieve. Easy cynical wisecracks aside, holding up a report in a budget meeting that says, "We can do this," could produce attitudinal change on the political scene that, again, could accelerate the run to self-sufficiency.

In international markets Monday, the Nikkei 225 index in Japan dropped 0.93 percent while the Shanghai composite index in China rose 0.49 percent. The Hang Seng index in Hong Kong gained 0.21 percent while the Sensex in India was flat, dropping 0.07 percent.

The S&P/ASX 200 in Australia slipped 0.31 percent.

In midday trading in Europe, the FTSE 100 index in Britain climbed 0.31 percent while the DAX 30 in Germany added 0.26 percent. The CAC 40 in France lost 0.24 percent while the Stoxx Europe 600 was off 0.02 percent.
ANTHONY HALL || United Press International

(Source: UPI )
(Source: Quotemedia)

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