Over the weekend the American news media was obsessed with another salacious (though ultimately not nearly so salacious as initially reported) story about the Trump administration.
Largely overlooked in that furor were coordinated drone attacks on roughly half of Saudi Arabia’s crude oil production facilities. Though the Saudi national oil company, Aramco, acted quickly to bring those facilities back online the resulting interruption touched roughly 6 percent of the world’s global oil supply.
Not surprisingly, oil prices have spiked, and with Iran apparently involved in the attacks (for what it’s worth that country is denying) the political instability around this situation is likely to persist.
That means further disruption of global energy supplies as the potential for war looms.
One positive in this situation is that we are more resilient to this sort of oil supply disruption than ever before. U.S. oil production has grown dramatically over the last decade, and we’re now at a highest-ever level of output. We are neck-and-neck with the Saudis when it comes to exporting oil.
Oil is a global market, so when it comes to prices what happens in Saudi Arabia matters, but it doesn’t matter as much as it once did because of America’s oil renaissance.
A renaissance made possible over the objections of certain ideological zealots in what I’m hesitant to call the environmentalist movement.