A New Industrial Revolution from Oil and Gas Production in North America: The New Middle East

The U.S. could soon surpass Russia and Saudi Arabia in oil production according to Citi report

Business Insider -- "Oil and gas production in the United States and North America is going to skyrocket in the next 8 years due to strides in natural resource extraction, write Citi analysts in a report published yesterday. In fact, they went so far as to call North America "the new Middle East," at least in terms of oil production.

This—as well as a trend towards declining U.S. energy consumption—will completely transform both the domestic economy and the threats the U.S. will face in the future.

Indeed, Citi economists expect total liquids production to as much as double for the continent in the next decade, and predict that the U.S. could overtake both Russia and Saudi Arabia in oil production by 2020 (see chart above). 

That's because there is incredible potential to extract and refine energy products on domestic soil, see map above.  

This energy boom would have a transformative effect on the domestic economy. Here are just a few of the most astonishing consequences in a "good-case" scenario:

• Citi analysts expect real GDP to increase by 2.0 to 3.3 percent—$370 to $624 billion—as a consequence of new production, a decline in energy consumption, and the economic activity generated along with this.
  
• 3.6 million new jobs could be created by 2020 as a consequence of increased energy production. Of those new jobs, some 600,000 would probably be devoted to oil and gas extraction while 1.1 million would be generated to meet demand in related industrial and manufacturing sectors. National unemployment could subsequently decline by up to 1.1 percent.
• What's more, risks to the U.S.—in particular, geopolitical risks—would dramatically decrease. A domestic or continental energy boom would diminish the importance of conflict within and tensions involving the Middle East, as the U.S. would become significantly more energy independent.
  
• Finally, Citi analysts note that this could lead to a considerable decline in oil prices."