Petraeus Discusses Energy Independence in the UAE

  • 31 January 2014

US is on the verge of becoming an energy superpower, yet it still relies on oil and gas from the Arabian Gulf region, former CIA Director David Petraeus told an audience in Abu Dhabi this week.

Speaking at the Emirates Centre for Strategic Studies and Research, Petraeus argued that the United States is better positioned economically than any other great power for the next 20 to 30 years.

The chairman of KKR Global Institute and former commander of US Central Command said the US growth will be led by its energy revolution and its 20-year long North American Free Trade Agreement (NAFTA) with Mexico and Canada.

“North America is also a zone of win-win geopolitics,” he said.

“Contrast this situation with China’s backyard, or India’s, or Europe’s or for that [matter] the Middle East, in most regions of the world in fact strong countries foster unease among their neighbors,” he said.

Despite America’s status, Petraeus said it still considers oil and gas from the Arabian Gulf as vital.

While the energy boom has extended to Canada and Mexico, the Arabian Gulf’s oil and gas still fuels the US’s trade partners and would for the foreseeable future, he said. .

“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,” he said.

He added that the strong political and economic relations between the US, Canada and Mexico, and their multicultural ties and values, protect them from animosity with its neighbors.

Petraeus said the US imported 37 percent of its oil in 2013, but that figure is expected to drop to 25 percent or less by 2016.

He added that America’s natural gas prices have fallen by more than 50 percent in the past five years, which is two to four times as much compared with Asia and Europe.

“In Mexico, President Enrique Peña Nieto is moving forward with historic energy sector reform,” Petraeus said. “Large production increases will take time but dramatic Mexican reforms are welcomed and very heartening news.”

Canada was also a part of the energy boom as it is 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-energize and propel the US economy forward over the coming decades.”

Speaking about the region, Petraeus insisted that 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.

“You [the UAE] have spectacular general purpose forces and special forces,” he said. “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.”