The US has recovered their power in the oil industry in the last year, the main reason for this to happen is that the new president is trying to invest in this type of industries, and this has led to companies making more innovative drilling technologies that reduce their costs and can help them maximize their outputs. The US is getting even more powerful than countries like Saudi Arabia and Russia that have been the biggest players in this industry in the last years. This not only gives the US and economic advantage in the world but also gives them political power because now they are not depending on other producers in order to provide oil, they can put sanctions and can break relations with countries like Saudi Arabia if needed, or have sanctions on Venezuela for the current situation of the country and not need to depend on their oil.
There is also another issue that this has created, and it's about the environment. Since the oil companies are creating new drilling places and are starting to extract more oil in the ones that they already have, they are looking on how much this is going to impact the environment and how much pollution can cause. Also, the government is responsible for this because they have been changing the regulations and the laws, to make it easier for companies to extract more oil and at lower costs. This also brings out the question how involved should be the government be in this? and if they should influence what happens in the market.
https://www.nytimes.com/2018/01/28/business/energy-environment/oil-boom.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region®ion=top-news&WT.nav=top-news
2 comments:
I definitely agree that the oil industry is centered on a complex argument surrounding business versus environmental sustainability. There are certainly numerous economic benefits for boosting the oil business. It creates jobs and it is one of the cheapest power sources around. However, as the environment becomes more and more fragile people are becoming concerned with the stability and longevity of oil usage and its impact on our surroundings. This is a classic example of the environment vs. efficient trade offs that we talked about in class.
This increase gives USA an edge as it's no longer dependent on other countries like Saudi Arabia for oil, especially as political stability disintegrates in the region. As Liz said, it is an efficiency vs environment trade off, even though a lot of countries, especially in Europe are moving towards renewable resources, a lot of countries are still heavily dependent on fossil fuels. So long as this is the case I don't believe Washington will prioritize environment over efficiency.
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