The rise of North Dakota oil production has now moved it to fourth rank in U.S. production, behind Texas, Alaska and California, respectively. Its sparse population partially explains why North Dakota currently enjoys the lowest unemployment rate in the U.S. In my February newsletter, Energy Supply and the Individual States, I explained the asymmetric benefits of U.S. production: local economies can benefit enormously from oil and gas production, even if not for the country as a whole.
It's true that U.S. oil production is currently at five-year highs, however, and that N.D. production has played a big role in steadying U.S. supply over the past year. This of course doesn't change the fact that U.S. oil production peaked in 1971, or that the U.S. imports more than 2/3rds of its oil supply. But that won't stop the "supply" of misleading journalism (i.e., enhanced oil recovery would alter global production).
This Scale Fail with regard to the public comprehension of oil supply is fairly rampant. I've predicted that the next presidential election cycle will bring forth candidates who will cynically, and dishonestly, claim the U.S. can become oil independent once again, once we start new drilling. That said, let's look at the chart of N.D. oil production:
Nearly 250 kbpd in oil production—from North Dakota? Wonderful news for North Dakotans—not such great news for the world, however. Because with Non-OPEC supply having peaked in 2004, and global supply having peaked in 2005, it puts a rather fine point on the fact that very few regions in the world actually made a supply response to the price move from $40.00–$150.00. If Fargo did not already have a certain resonance owing to recent cinematic history, there's a new reason now.
It's true that U.S. oil production is currently at five-year highs, however, and that N.D. production has played a big role in steadying U.S. supply over the past year. This of course doesn't change the fact that U.S. oil production peaked in 1971, or that the U.S. imports more than 2/3rds of its oil supply. But that won't stop the "supply" of misleading journalism (i.e., enhanced oil recovery would alter global production).
This Scale Fail with regard to the public comprehension of oil supply is fairly rampant. I've predicted that the next presidential election cycle will bring forth candidates who will cynically, and dishonestly, claim the U.S. can become oil independent once again, once we start new drilling. That said, let's look at the chart of N.D. oil production:
Nearly 250 kbpd in oil production—from North Dakota? Wonderful news for North Dakotans—not such great news for the world, however. Because with Non-OPEC supply having peaked in 2004, and global supply having peaked in 2005, it puts a rather fine point on the fact that very few regions in the world actually made a supply response to the price move from $40.00–$150.00. If Fargo did not already have a certain resonance owing to recent cinematic history, there's a new reason now.
