The International Energy Agency says the oil fields of North Dakota are turning the global oil market on its head. Canada's oil sands, too, to be fair. The agency's latest report on world oil supplies says North America's oil boom is turning out to be even bigger than predicted. Within five years, the U.S. and Canada will be meeting most of the world's new oil demand.
Whoa. Wasn't it just a few years ago we were fretting about "peak oil?'
"It's very much a welcome change in the oil market," says Amrita Sen, chief oil analyst at Energy Aspects in London. "Simply because prices are already very high and without this sort of supply, arguably prices could be even higher."
Analyst David Pursell in Houston says if the IEA's predictions hold true (and they don't always) it's good news for the average American driver.
"Oil prices probably don't go up a whole lot more from here," says Pursell. "They probably don't go down, either, because it takes a high oil price to achieve this kind of growth. But what it says is you don't have to worry about $6, $7, $8 gasoline, and that should be a big relief."
The U.S. and Canada are displacing OPEC as the driver of global oil supply growth. Analysts say that means we're closer to energy independence than we've been in decades.
But that won't protect us from price swings, since oil's a commodity. It's sold on the world market to the highest bidder. Despite the U.S. oil boom, Saudi Arabia is still the world's largest producer. But the IEA expects the U.S. will overtake Russia for the number two spot in a couple years.