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The story of the year is arguably the growth of shale oil and gas as a viable part of the U.S. economy.In a New York Times op-ed yesterday, Alan Riley, a professor of energy law at The City Law School at City University London, says that the European Union will get crushed because of it.
The reason is that America will soon become nominally self-sufficient and draw down its fuel exports.
As a result, he says, the EU will lose its principal muscle guaranteeing stable fuel flows from classic megaproducers like Russia and Saudi Arabia.
American self-sufficiency in oil is of greatest concern to the European Union. The danger is that the United States will no longer have any direct interest in ensuring supply flows out of the Gulf. At the very least this will mean that Washington is likely to demand greater European investment in its own energy security.
The EU will have to spend even more on new infrastructure to ensure fuel stability, he says.
And where that money will come from is anyone’s guess.