World Economic Forum gets new energy update

While unconventional energy has been “a big boost” for North America, IHS Chief Economist Nariman Behravesh, one of the report’s authors, said its impact will also eventually be seen more widely as other countries develop their shale gas and tight oil resources

By ·

The unconventional oil and gas revolution has dramatically changed the global energy landscape, and in its wake is altering the world’s competitive manufacturing and industrial panorama, according to a new report from IHS, a leading source of global information and analytics.

The report, Energy and the New Global Industrial Landscape: A Tectonic Shift, is being released for the World Economic Forum 2013 Annual Meeting in Davos-Klosters, Switzerland where IHS is a strategic partner. It looks at the impact of unconventional (shale gas and “tight oil”) energy on world energy markets, the automotive and chemical industries as well as on the United States where it is improving manufacturing competitiveness.

While unconventional energy has been “a big boost” for North America, IHS Chief Economist Nariman Behravesh, one of the report’s authors, said its impact will also eventually be seen more widely as other countries develop their shale gas and tight oil resources.

“Initially, this has been – and will continue to be – a big boost for North America,” Behravesh said. “However, other regions and countries with large shale gas and tight oil deposits can, with time, also participate in this energy revolution and industrial renaissance.”

A new study by IHS estimated that in the United States alone, the surge in unconventional oil and gas extraction has led to the creation of 1.7 million jobs and added $62 billion to federal and state coffers in 2012.

The big drop in energy prices has also led to a surge in investment in the United States, posing a risk for Europe and Asia which face migration of manufacturing to North America and the loss of competitiveness, said Behravesh.

The question of whether the unconventional oil and gas revolution will go global is increasingly being asked by companies and governments alike as major opportunities have been identified around the world, according to IHS Vice Chairman Daniel Yergin, also an author of the report.

“Major opportunities are being identified around the world,” said Yergin. “Our research indicates that the resource base in China may be larger than in the United States, and we note prospects elsewhere. However, circumstances that promoted this development in the United States differ in important aspects from other parts of the world. It is still very early days and we believe that it will take several years before significant amounts of unconventional oil and gas begin to appear in other regions.”

“There is one wild card, however, said Derik Andreoli, Ph.D.c., a senior analyst at Mercator International LLC and Logistics Management’s popular Oil & Fuel columnist: Iraqi production.

“After decades of underinvestment under Sadam Hussein, Iraqi production has been booming,” he said. “If Iraq continues this performance, surplus oil production capacity could increase, which will be advantageous from the perspective of price volatility.”


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Global · Logistics · Manufacturing · All Topics
Latest Whitepaper
Outsourcing the Indirect Supply Chain
This in-depth whitepaper takes you through the journey that Smith & Nephew - a global research, development and manufacturing company of medical devices and products - underwent when initially looking for a provider to manage their tool cribs and eventually decided on an end-to-end supply chain management firm. Outsourcing white papers, SDI medical device manufacturing
Download Today!
From the July 2016 Issue
While it’s currently a shippers market, the authors of this year’s report contend that we’ve entered a “period of transition” that will usher in a realignment of capacity, lower inventories, economic growth and “moderately higher” rates. It’s time to tighten the ties that bind.
2016 State of Logistics: Third-party logistics
2016 State of Logistics: Ocean freight
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Getting the most out of your 3PL relationship
Join Evan Armstrong, president of Armstrong & Associates, as he explains how creating a balanced portfolio of "Top 50" global and domestic partners can maximize efficiency and mitigate risk.
Register Today!
EDITORS' PICKS
Regional ports concentrate on growth and connectivity
With the Panama Canal expansion complete, ocean cargo gateways in the Caribbean are investing to...
Digital Reality Check
Just how close are we to the ideal digital supply network? Not as close as we might like to think....

Top 25 ports: West Coast continues to dominate
The Panama Canal expansion is set for late June and may soon be attracting more inbound vessel calls...
Port of Oakland launches smart phone apps for harbor truckers
Innovation uses Bluetooth, GPS to measure how long drivers wait for cargo