Last November there was a $10 billion shale gas production-sharing agreement signed in Ukraine with Chevron. It followed a similar deal earlier with Royal Dutch Shell.
President Viktor Yanukovich said:
“The agreements with Shell and Chevron … will enable us to have full sufficiency in gas by 2020 and, under an optimistic scenario, even enable us to export energy.”
That was President Yanukovich – the “Putin puppet.” Those who have now taken over are hardly likely to be less enthusiastic about the prospect of energy independence from Moscow.
This is not just a matter of interest to Ukraine.
Lord Lawson has highlighted the politics of shale for some time. Hitherto “the West has been heavily dependent for its supplies of oil
and gas on an unstable Middle East and an unreliable Russia.” But fracking has already “shaken up the old world order”. The US will overtake Saudi Arabia as the world’s largest oil producer in 2017.
For decades, the West in general, and the U.S. in particular, has had to shape, and sometimes arguably to misshape, its foreign policy in the light of its dependence on Middle East oil and gas. No longer: that era is now over.
For decades, too, Europe has been fearful of the threat that Russia might cut off the gas supplies on which it has relied so heavily.
No longer: that era will very soon be over, too. Thanks to the shale gas revolution, the new found energy independence of the West is a beneficent game-changer in terms of world politics as much as it is in the field of energy economics.
Lord Lawson does not claim that our diplomatic and military requirements will be redundant – “there is more to international politics than oil and gas.” The other benefits of shale gas – cheaper energy and lower carbon dioxide emissions – are also important. However long term political benefits of fracking matter as well. It will make it easier for countries to assert their national independence, without being bullied by dictatorial neighbours.