Houston, March 23. The Economist tells us about the atmosphere at CERAWeek – the Woodstock of energy – where Chris Wright, Secretary of Energy and an old shale wolf, kicks off the event with a smile of someone who knows they’ve won the lottery: “Markets do what they know how to do,” he says, and the room bursts out laughing.
The war in the Middle East? Yes, it hurts, but it gives the US a boom: a hundred-dollar barrel, profits raining down like confetti. Rystad Energy does the math: if it stays like this all year, American companies will earn over sixty billion extra.
It’s not just oil: with Qatar blocked – a fifth of the world’s liquefied gas gone for who knows how long – LNG companies like Venture Global see their shares double in a month.
The Texas party
In Texas, a hundred dollars excites. It’s the price that restarts drilling, inflates budgets, fills wallets. Wright, who knows shale well, explains it with pleasure: “Prices are high enough to push production, but not so high as to close factories or turn off lights.”
In other words: demand holds, supply can grow. And while the world trembles over the conflict, here they celebrate.
Hormuz and too much uncertainty
But there are many shadows under the carpet.
The conflict is not a firework: it’s a time bomb. Trump wants to negotiate, but Iran could keep the Strait of Hormuz closed for weeks.
Jim Mattis, former general and Trump’s first Secretary of Defense in his first term, describes it as a logistical nightmare: “Few options, none easy.”
The markets? They dance on rumors, not facts. Mike Wirth of Chevron says it bluntly: “We’re betting on nothing solid.” And if the war drags on? The first consequence is that the shale market doesn’t move.
Shale
After the 2014-2020 crash – three hundred billion wasted – no one wants to repeat the mistake. The bosses repeat it: “Capital must move in a disciplined way.”
Raoul LeBlanc of S&P Global observes: “It takes two quarters at a hundred dollars, plus a soaring futures curve, otherwise nothing.”
And even starting now, new wells need three to nine months to start production.
The conclusion is that US natural gas is a bit like an island: Henry Hub keeps its forecasts low, indifferent to global chaos.
In short: no boom, just fat margins for exporters.
The final blow comes from the East
The real ghost is Asia. There, where Middle Eastern oil is oxygen, it’s already visible: less gasoline, more solar, electric cars flooding the streets.
Before the war, the global peak was expected by 2030; now the conflict brings it closer. Current high prices are enough to keep the accounts in the green, but without buyers the castle could collapse in no time.
In short, oilmen are toasting today, but in twelve months – if demand vanishes – they could find themselves with full warehouses, falling prices, and an epic headache.
