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The new global oil scene

Hisham Melhem

Published: Updated:

The production of energy in the U.S. has witnessed substantial changes that may make the country surpass Saudi Arabia and Russia and become the largest oil producing nation in the world by 2020. Also, the increase of petroleum production in Canada and Mexico will lead to geopolitical and economic changes in the entire world. It may also alter Washington's manner in dealing with the Middle East, Russia and China. This truth will be one of the painful facts that will confront Iranian negotiators when they sit in Kazakhstan to resume talks on the Iranian nuclear program with the P5+1 group.

Iran is considered one of the most prominent losers as the result of the deep changes that occurred within energy sectors in the past two years. This is because the Iranian regime thought that the West will not impose oil sanctions on it because such a move will increase the international price of petroleum and because the world will not be able to compensate for Iranian production.

But the American oil fields (and the modern means that allows increasing production from old fields, also allowing the production of huge amounts of gas) have in past years led to an increase in American oil production that reached around 1.5 million barrels a day. This is the amount that could have been produced by Iran if the latter had not been subject to sanctions.

America’s energy

Iran is considered one of the most prominent losers as the result of the deep changes that occurred within energy sectors in the past two years.

Hisham Melhem

In 2012, the average of America's petroleum production was 6.4 million barrels per day. This led to the decrease of the amount of imported oil to 1.3 million barrels per day where each barrel costs around $100. But the American government is looking forward towards increasing the production to 8 million barrels per day by the end of this year. A study has expected that the price of one barrel would be between $70 and $90 by the year 2020.

If oil production is increased in North America and other areas across the world to reach 8 million barrels a day, as U.S. intelligence estimates, this will lead to catastrophic consequences that oil-exporting countries including Iran, Libya, Yemen and perhaps Iraq will suffer from. In turn, this will lead to the weakening and perhaps the disintegration of OPEC. By 2020, it is expected that America will have stopped importing petroleum from all oil countries except Canada. And the increase of American gas production will decrease Europe's dependence on Russian gas.

Self-sufficiency in the field of energy will "liberate" America from the burden of its commitments in the Middle East. Washington will not ignore the Middle East but its interest in it will subside especially that it seeks to focus more on the Far East. The Middle East will continue to be important for America but it will not be among its top priorities by the end of the decade.


This article was first published in Lebanon-based newspaper Annahar.
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Hisham Melhem is the Washington bureau chief of Al Arabiya. He is also the correspondent for Annahar, the leading Lebanese daily. Melhem's writings appear in publications ranging from the literary journal Al-Mawaqef to the LA Times, as well as in magazines such as Foreign Policy and Middle East Report. Melhem focuses on U.S.-Arab relations, political Islam, Arab-Israeli issues, media in the Arab World, Arab images in American media. In addition, Melhem has interviewed many American and international public figures, including Presidents Barack Obama and George W. Bush, Secretaries of State Colin Powell and Condoleezza Rice, Secretary of Defense Robert Gates, and Chairman of the Joint Chiefs of Staff Admiral Mike Mullen, among others. Twitter: @Hisham_Melhem

Disclaimer: Views expressed by writers in this section are their own and do not reflect Al Arabiya English's point-of-view.