Fifty years since the first Oil Shock: how much has changed?

This week marks 50 years, almost to the day, since the 1973 OPEC oil embargo on the US, which led to global oil prices soaring. Oil’s potential role as a political weapon was thrown into sharp relief, and the world woke up to a new awareness of the vital importance of energy security.

On the Energy Gang this week, Ed Crooks hosts Robbie Orvis and Amy Myers Jaffe, to explore the parallels between that first great oil shock and the economic and political issues arising from the conflict in the Middle East today. Robbie is Senior Director of Modeling and Analysis at the think-tank Energy Innovation, and Amy is Director of NYU’s Energy, Climate Justice and Sustainability Lab. Together they discuss the implications for energy security in the US, and around the world, of the fighting that began with the Hamas terrorist attack on Israel.

This month US oil production has hit a new all-time record high, at 13.2 million barrels a day. This surge in production means the US will be a net exporter of crude and oil products this year, to the tune of almost 2 million barrels a day. That sounds like it should help US energy security, but does it really? Despite surging production, US consumers remain vulnerable to fluctuations in fuel prices. Reducing oil consumption, as the gang discuss, could be the best way to strengthen energy security.

Electric vehicles play a critical role in helping to break our addiction to oil. There have been some big changes in that industry this year, with most leading auto-makers, including Hyundai, Kia, Ford, GM, and others, adopting the North American Charging Standard developed by Tesla. That is a big win for Elon Musk, but more importantly it’s a big win for customers, who won’t have to worry about getting an EV with the right connection ports to find public chargers. It’s like Lightning cables versus USB-C, but with much more at stake.

Finally, we look once again at the ever-evolving hydrogen sector. The Biden administration last week announced the seven Hydrogen Hubs selected to share $7 billion in government funding to accelerate the domestic market for clean hydrogen. The hubs are spread around the country, from the Pacific Northwest to south Texas, and are intended to catalyse more than $40 billion of private sector investment.

The idea behind the hubs is that developing the industry in a few locations will make it easier to share infrastructure and a skilled workforce, helping to bring costs down faster. But questions still remain about how big a role hydrogen can play in the energy transition.

It’s a packed show, and as usual we are keen to hear thoughts and comments. You can find us on most platforms – we’re @theenergygang. Subscribe to the show so you don’t miss the next one, out every second Friday at 7am ET.

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