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Energy Institute’s 2015 International Index of Energy Security Risk Shows Continued Progress for U.S. Norway Hangs on to Top Spot Thanks to Strong Energy Production
WASHINGTON, D.C.— Despite political instability in some large oil producing countries of the Middle East and elsewhere, energy security risks for the top 25 major energy users declined in 2013 thanks in large part to the market-calming influence of greater unconventional oil and natural gas output from the United States and Canada. This analysis is part of the U.S. Chamber Institute for 21st Century Energy’s 2015 edition of its International Index of Energy Security Risk, which ranks countries based on 29 metrics in eight areas related to energy security. According to this year’s index, Norway is once again the top ranked country in the world, largely due to its status as an exporter of all types of fossil fuels and electricity and energy efficient economy. Rounding out the top five ranked nations are Mexico, Denmark, New Zealand, and the United Kingdom. The United States came in at number six, up one spot from last year and six places from 2000. “The shale revolution and increased oil and gas production have continued to drive U.S. energy risks downward, improving our standing in our latest international index and also helping to lower risks for other countries,” said Karen Harbert, president and CEO of the Energy Institute. “While market turmoil in the Middle East in 2013 should have been a recipe for a large jump in crude oil prices, that didn’t happen because of the price smoothing effect of greater North American production, led by the United States.” The report, which includes data through 2013 (the latest year available), shows how a nearly 900,000 barrels per day loss in oil output from Libya, Iran, and Nigeria, which normally would cause tremendous upward price volatility, was more than offset by a 1.1 million barrels per day increase in U.S. and Canadian production. The report also notes how the increase in U.S. natural gas production is moderating the risks associated with greater production from nations like Russia, Algeria, and Iran, the sources of many of European natural gas imports. Risk associated with higher electricity prices is also instructive as the U.S. considers EPA regulations on coal plants that could raise costs. There is a wide variance in retail electricity prices among large energy users, and the U.S. currently ranks fifth, providing a more favorable price environment than most other nations. “Seven of the bottom 10 ranked countries in electricity prices are in Western Europe, which along with Japan now have some of the most expensive electricity prices in the world,” said Steve Eule, vice president at the Energy Institute. “Meanwhile, the use of affordable coal for power production in North America, Australia, and other parts of Asia have kept prices low for those nations, and lowered their risk scores. It’s important we keep this price advantage from both an energy security and economic perspective.” As in last year’s index, Ukraine was the lowest ranked nation among the top 25 large energy users. The country’s risk scores are one quarter higher than 24th ranked Thailand, underscoring the severity of its situation. Ukraine’s low rank demonstrates how energy vulnerabilities can create geopolitical vulnerabilities during a political crisis. The Energy Institute has once again produced an interactive web tool that provides ranking information and profiles for the top 75 energy consuming countries in the world. The Institute also produces the annual Index of U.S. Energy Security Risk, which is released in the fall.
The mission of the U.S. Chamber of Commerce's Institute for 21st Century Energy is to unify policymakers, regulators, business leaders, and the American public behind a common sense energy strategy to help keep America secure, prosperous, and clean. Through policy development, education, and advocacy, the Institute is building support for meaningful action at the local, state, national, and international levels. The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.