Predictions

I thought you might be interested in an update on how the dramas described in my book, The Energy of Nations, are playing out. Even if you follow developments closely yourself, I’m hoping you’ll find my personal take on the patterns of play interesting.

I finished writing the book during the Easter break a year ago. In it, I made predictions about three systemic risks being run by the energy incumbency: the risk of a shale ‘surprise’ (wherein an incumbency narrative-of-plenty in long-term extractable unconventional gas proves wrong), the risk of an oil crisis (wherein another incumbency narrative-of-plenty, involving growing global supplies of affordable oil far into the future, turns out to be flawed), and the risk of carbon-fuel asset stranding (wherein policymaking on climate change, or the possibility of it, causes investors to abandon significant amounts of oil, gas and coal assets underground, unburned).

During the year since, I have kept a log of developments relevant to these predictions, as I encounter them in my vocational life and reading, on my website. I also cover the related themes of climate-change risk and the risk of renewed financial crisis.

I invite you to have a scan of that log, if you haven’t already, at the level of headlines only, and check the direction of things. The log would suggest that all three predictions are on course, I think. And if I and people who think like me are right about any or all of this, the implications for all our lives will be enormous.

Some extracts from the log over the year since the book came out:

Shale ‘surprise’

We have learned that the top 15 players in US shale drilling have written off $35 billion since the boom started, and that investors are beginning to pull out. Meanwhile, production has peaked and is now falling in all but one of the major shale-gas drilling regions. The boom is looking like it could turn into a bust before too long.