Can American Producers Head Off Looming Oil Shortages?

 The world needs more oil

• Despite years of hyperbole and massive spending on an "energy transition" to alternatives, the cost of oil and gasoline remains critical
• The problem with this epiphany is that neither America's nor the world's oil and gas industries are ready to produce enough either to fuel growth or to delink from Russia
• Collective spending on new production by global energy companies is down about 70 percent from normal levels
• If the U.S. were to expand production by only half as much as the shale-boom delivered, that would only slightly delay the inevitable need for more oil production
• In fact, vastly more investment in new production will be required than is now in play even if the world sees oil demand peak within the decade, as the International Energy Agency hopes

Supply-chain and labor challenges, inflation's impact on supplies and services, and a resurrection of peak-oil theory

• Despite a sustained period of high prices, U.S. production has remained stubbornly below pre-Covid levels, even as demand has rebounded
• The shale boom did not happen because of any resource discovery or government stimulus, it was the result of decades of development with complementary-technology progress

Early digital successes have been in the soft worlds of news, finance, business processes, and entertainment

• Now, software and automation tools have become useful enough to work in the hard worlds of machines and supply chains
• The popular trope that AI and robots will take work away from humans is wrong
• Augmenting and amplifying the "labor pool" are the path to accelerating the production of anything-as well as being the path of broad societal wealth expansion

Industrial robots

• New class of untethered industrial robots: mobile and can work alongside people
• Currently, biggest and fastest-growing market for mobile robots is in handling materials in warehouses
• Soon, mobile robots will be able to operate in more challenging places, including outdoors, and to take on a wider range of tasks

Bottom Line

• There is a clear way for the U.S. government to shock the world's critical energy markets: a fulsome and legislated embrace of policies that allow-not subsidize-increased hydrocarbon production.
• To make that happen, neither rhetoric nor ex

https://www.city-journal.org/can-american-producers-head-off-looming-oil-shortages