‘Tempered optimism’ for the oil and gas industry

But you might not know that if you listened to the Washington political debate over oil and gas, which has seen industry advocates criticize the Obama administration for waffling over approvals for the Keystone XL pipeline, threats to tighten regulation on fracking and a drop in production on federal land.

Oil and gas companies from around the world have flocked to the U.S. to take part in the boom enabled by advanced technologies that have opened up vast new reserves. And that access, as well as the ability to own the mineral rights and reserves that are still in the ground, are crucial incentives for companies that have complained for a decade that many of the best oil fields in the world are under control of state-owned energy companies and are off limits to them.

Longtime fears that the country’s oil supplies were dwindling have vanished, energy executives say. In their place, there’s gleeful talk of abundance. Some here call it an oil and gas revolution; others call it a renaissance that harkens back to the years after World War II, when production climbed toward its eventual peak in 1970 at nearly 10 million barrels day.

Case in point: Oil and gas companies are running 1,757 rigs to drill new wells in the U.S., well above the 1,275 rigs operating in the rest of the world, according to data from oil field services company Baker Hughes.

The new optimism was on full display at the annual IHS CERAWeek energy conference last week, the oil and gas industry’s Super Bowl.

CERAWeek is part pep rally, part networking opportunity. Attendees pay as much as $7,250 per person to get face time with top executives and government officials, often elbowing past reporters after panel discussions to hand out business cards.

Presiding over the conference is Daniel Yergin, a longtime energy analyst and Pulitzer Prize-winning author. Yergin, the vice chairman of IHS CERA, an energy research firm, spends the week peppering the energy world’s royalty with questions.

The oil and gas industry has seen its fair share of ups and downs over the years, from the boom time of the 19th century to the oil crisis of the 1970s, Yergin told POLITICO, but there’s a sense in the industry that things are different this time.

“We’ve got to be aware of rosy scenarios, and I think experienced people … are cautious about rosy scenarios. But I would say … it’s a mood of tempered optimism and confidence that technology will solve our problem — continue to help us meet these big energy needs and these big environmental needs that we have,” he said.

BP Group CEO Bob Dudley encapsulated that mood when he named the U.S. one of the world’s two energy giants, pointing to a surge in oil production both offshore and onshore.

“The process of reaching out for new resources is going on all over the world but nowhere more so than in the country that produces the most oil and gas — Russia — and the country that is exhibiting the most spectacular growth in production — here in America,” he said during a keynote speech at the conference.

4 Comments on "‘Tempered optimism’ for the oil and gas industry"

BillT on Mon, 11th Mar 2013 1:05 pm 



Yergin, the corporate shill/pimp again!

Beery on Mon, 11th Mar 2013 1:59 pm 



The public face of private desperation. These folks all know full well that the shale revolution is a sham. They’re just trying to make sure that they get the most they can out of it before the music stops. I pity the poor saps who are gulled into staking their retirements based on all this empty and misleading rhetoric.

DC on Mon, 11th Mar 2013 6:04 pm 



Q/This overwhelming optimism underscores the new energy reality that the United States is one of the best places in the world for the oil and gas industry to do business.

100% true. No environmental regulations or enforcement to speak of. No royalties, total immunity from prosecution of any kind, endless tax breaks and subsidies, and a murdering military to insure that the worlds oil remains in US hands. Complete regulatory capture at national and local levels and a compliant press to insure very little(real) information about your illegal and immoral activities.

Yup, the US IS indeed the best place in world to be in the oil business…..

rollin on Tue, 12th Mar 2013 5:36 pm 



The US has switched to the reserve tank, there is not that much left, we have a low reserve capacity and a high demand.

Interesting that we have more drilling rigs than the rest of the world and have only blipped up our production of crude.