ENERGY INDEPENDENCE ON THE HORIZON - The Power Surge: Energy, Opportunity, and the Battle for America's Future - page 78

slightly smaller than U.S. demand, even this option would be impos-
sible to pursue without substantially raising U.S. oil prices or causing
shortages of crude.
h at said, if more U.S. oil production might not do much to
strengthen the United States against its adversaries, it could do more
to weaken those opponents themselves. Iran is fueled by oil sales; so
is Russia. Hugo Chavez has dominated Venezuela for a decade by stra-
tegically employing oil revenues, something Saddam Hussein managed
to do for even longer in Iraq. And although we saw earlier that greater
U.S. oil production might not slash oil prices, the reason was important:
other producers might curb their own production in response. Either
way, oil exporters would suf er, either selling less crude or get ing less
money per barrel. Not all of them would be hostile—in fact some, like
Kuwait and Iraq, are actually U.S. partners in many respects—but many
could well be.
Economic logic aside, rising U.S. oil output is also likely to af ect geo-
politics simply because of how leaders react to it. My colleague Blake
Clayton and I have studied how pat erns of oil trade af ect relation-
ships between countries. 49 One of the most striking i ndings is that if
leaders believe that changes in the oil market will have big political
consequences—and leaders ot en do believe that—they take steps that
themselves can change the world. For example, Saudi Arabia under-
priced oil that it sold to the United States for decades, in an at empt
to remain the largest oil supplier to the United States. Saudi leaders
reasoned that many U.S. diplomats and strategists believed the largest
supplier of oil to their country must be important and would thus
treat Saudi Arabia deferentially. h ey were probably right. Today, if
Middle Eastern oil producers conclude that rising U.S. oil produc-
tion will weaken U.S. interest in the region, they'll take steps to build
new alliances with other world powers. If leaders in Beijing believe
that the United States will no longer be as interested in protecting
critical sea lanes that link Middle Eastern oil markets to the wider
world (including China), they'll build up their navy more quickly, with
broader results. All of this can happen even if economic analysts insist
that the United States will remain vulnerable to events in the Middle