We can't predict with certainty the longterm impact of technology, but the experience of the last decade in introducing new technologies such as horizontal drilling, three dimensional seismic analysis and subsea completions offers hope that domestic producers will continue to push the frontiers of oil exploration and development. Let me close on a historical note. It was almost exactly 20 years ago that CIA published an unclassified study that concluded that by the mid-1980s demand for Persian Gulf and other OPEC oil would reach 50 million barrels per day. Prices would rise sharply, to more than 40 dollars a barrel, and Saudi Arabia would reap enormous financial surpluses. Today, OPEC provides only half that amount, and a barrel of oil costs only about 23 dollars.
Prices are stable, and unimpeded access to world energy supplies is the order of the day.
CIA forecasts at that time were typical of the hundreds of published during the 1970s and early 1980s by oil experts in government, the World Bank, academia and private consulting firms. Today we have a better appreciation of the hazards of longrange forecasting, which almost inevitably results in inflated predictions. But there's no room to be complacent. Iraqi aggression was turned back and for now the threat has been contained. But the potential for destabilizing conflict in the Gulf and costly disruptions in the oil supply still loom on the horizon.