ABU DHABI // The US may be becoming an energy superpower but it still considers oil and gas from the Arabian Gulf as vital, according to the former director of the US Central Intelligence Agency.
David Petraeus, the chairman of the KKR Global Institute and former commander of the US Central Command, said that while the energy boom had extended to Canada and Mexico, the Arabian Gulf’s oil and gas still fuelled the US’s trade partners and would for the foreseeable future.
He was speaking at a lecture on the forthcoming North American decades at the Emirates Centre for Strategic Studies and Research last night.
“According to projections, the US is set to become a leading oil producer by 2020,” he said. “Crude oil production is expected to reach 9.5 million barrels a day by only 2016, and this situation is dramatically changed since 2008-2009, when many experts said oil production had peaked and wasn’t ready to climb. They couldn’t have been more wrong.”
He said the energy revolution was a result of American innovation. “The changes that have resulted are already extraordinary, and they will become more so in the years ahead,” said Gen Petraeus.
“The US recently took over as the leading producer of natural gas and we haven’t reached 100 years of natural gas reserves yet with more being found every day.”
He said America’s natural gas prices had fallen by more than 50 per cent in the past five years, which was two to four times as much compared with Asia and Europe.
“It’s not just in the US,” he said. “In Mexico, president Enrique Pena Nieto is moving forward with historic energy sector reform. Large production increases will take time but dramatic Mexican reforms are welcomed and very heartening news.”
He said Canada was also a part of the energy boom as it was diversifying its market outlets for oil.
“It will continue to export the majority of its energy to the US,” he said. “And after a considerable delay, the US administration will this year approve the XL pipeline to go to the southern US refining markets.”
North America will be much more energy independent, and “the US is well on its way to being an energy superpower”, he said. “This revolution has the potential to re-energise and propel the US economy forward over the coming decades.”
While increased domestic energy means less dependence on areas such as the Middle East, “the US continues to see the free flow of energy resources from the Gulf as a vital resource because it still fuels our trade partners and will for the foreseeable future”, said Gen Petraeus.
He said the UAE also had promising years to come. “The future of the UAE is extraordinary and it’s seemingly bright,” he said. “What you have achieved in recent decades is breathtaking.”
Gen Petraeus, who first visited the UAE in 1989, said the country had gone through massive intellectual growth.
“The investment made in education, linking Abu Dhabi, Dubai and other emirates with many leading US universities is extraordinary and a very important initiative,” he said.
He also commended the UAE’s military: “You have spectacular general purpose forces and special forces. They’re small but it is a small country, and one that punches way above its weight. It has an influence that is disproportionately large to its size and that’s a tribute to the quality of your leaders and your diplomats.”
He said the UAE was in a “tough neighbourhood” which would need “great skill to continue to navigate through very turbulent waters in the region”.
“It’s got difficult neighbours in many different directions,” said Gen Petraeus. “Some are still grappling with the after-effects of the Arab Spring but the UAE has sought to help these countries.
“Warren Buffett always said that you had to invest in leadership and the truth is the UAE is a country with great leadership, and I’m very confident in it.”