Predictions FROM Jeremy Leggett, author ENERGY OF NATIONS

The Energy of Nations.  Since the  5 months the book has been out , here isan update on how the dramas are playing out :I finished writing the book during the Easter break a year ago. As you know,I made predictions about three systemic risks being run by the energyincumbency: the risk of a shale “surprise” (wherein an incumbencynarrative-of-plenty in long-term extractable unconventional gas proveswrong), the risk of an oil crisis (wherein another incumbencynarrative-of-plenty, involving growing global supplies of affordable oil farinto the future, turns out to be flawed), and the risk of carbon-fuel assetstranding (wherein policymaking on climate change, or the possibility of it,causes investors to abandon some oil, gas and coal assets underground,unburned). During the year since, I have kept a log of developments relevantto these predictions (plus the themes of climate change and renewedfinancial crisis) on my website.I invite you to have a scan of that log, if you haven’t already, at thelevel of headlines only, and check the direction of things. The log suggeststhat all three predictions are on course. If I and people who think like meare right about any or all of this, the implications for all our lives willbe 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 shaledrilling have written off $35 billion since the boom started, and thatinvestors are beginning to pull out. Meanwhile, production has peaked and isnow falling in all but one of the major shale-gas drilling regions. The boomis looking like it could turn into a bust before too long.– Oil crisis: We have learned the extent to which capital expenditure onfinding new reserves has soared, and discoveries by major oil companies havedropped. Meanwhile, crude oil production, which meets some three quarters ofglobal demand, peaked in 2005. Who says so? A man BP asked to compileestimates of global oil supply when he worked for the company.– Carbon-fuel asset stranding: We have seen major financial institutionsstart pulling out of carbon-fuel investments. Other institutions remaininginvested are pressuring carbon-fuel corporations to rein back capital beingexpended on efforts to turn resources into reserves. This is good news forthose who worry about the risk of a carbon-fuel asset “bubble”, and wish todeflate it sustainably, abating climate-change risk in the process. It isbad news for an incumbency needing ever more capital to keep its narrativesof carbon-fuel plenty on track.Over the course of the last year, instead of retreating from the comfortingnarratives they spin us as you might think the above would warrant, much ofthe oil and gas incumbency becomes ever more shrill in hyping mantras. Theyspeak of America becoming the new “Saudi America” – a nation self-sufficientin oil and gas that exports to help allies in trouble, like Ukraine. Thereality behind the myth is that America imports both gas and oil – a lot ofoil. US oil consumption is 18.5 million barrels a day. Production is 8.9million barrels a day. What part of that equation are they going to exportany time soon to save Ukraine and others from the clutches ofKremlin-controlled pipelines?The edge of madness in the air over this and other aspects of energy“policymaking” encourage me to redouble my effort to do the best I can insounding an alarm.