Global Energy Crisis Emerges in 2022, But More Resilient Markets and U.S. Oil Abundance Buffer Impact
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Oil and gas prices spiked in 2022 after Russia's invasion of Ukraine, leading to the "first truly global energy crisis" with widespread impacts.
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In contrast to the 1970s oil shocks, today's more interconnected global energy system can respond better to supply disruptions through releases from strategic reserves, market reallocation, and "grey-zone trading."
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The shale gas and tight oil revolution in the U.S. has transformed geopolitics, boosting U.S. production, reducing import reliance, and contributing to abundant energy supplies.
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Greater U.S. energy self-sufficiency has enabled a shift in foreign policy focus to Asia and reduced worries about stability in the Middle East.
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While oil markets are now more resilient, tightening supplies or conflict in strategic maritime chokepoints could still roil markets as climate politics may curb investment.