make up for an anticipated shortfall in domestic production. Now the US is not importing any LNG thereby saving $100 billion on its annual import bill. At current prices, the increase in US oil production has been cutting another $100 billion from that bill. In addition, the unconventional revolution supports over two million jobs.The global impact has been enormous. Much of the new global LNG capacity was developed with the US in mind. Now, with the US market cordoned off by cheap domestic gas, some of that LNG is going to Europe, introducing unexpected competition for traditional suppliers Russia and Norway.For Japan, the lack of US demand for LNG proved fortunate in the aftermath of the disaster at the Fukushima Daiichi nuclear-power plant in 2011. Much of that LNG could go to Japan to generate electricity, replacing the electricity lost from the total shutdown of nuclear power.Many other countries are reassessing their own energy policies in light of the unconventional-energy revolution. China, seeing the speed and extent of US shale-gas development, has placed a high priority on developing its extensive unconventional gas resources. For China, replacing coal with natural gas in electricity generation is essential to mitigate public discontent and health problems stemming from the heavy burden of urban air pollution.The rise of US shale energy is also having a broader global economic impact: American shale gas is changing the balance of competitiveness in the world economy, giving the US an unanticipated advantage. Indeed, inexpensive natural gas is fueling a US manufacturing renaissance, as companies build new plants and expand existing facilities.Throughout Europe, industrial leaders are becoming increasingly alarmed by enterprises loss of competitiveness to factories that use low-cost natural gas and the consequent shift of manufacturing from Europe to the US. This is particularly worrying in Germany, which relies on exports for half of its GDP, and where energy costs remain on a stubbornly upward trajectory. These high costs mean that German industry will lose global market share.Whatever their targets for shifting their energy mix, European Union countries, already suffering from high unemployment, will be forced to reconsider high-cost energy strategies or face weakening competitiveness and loss of jobs.The geopolitical impact is already evident. For example, Iran is now seriously at the table in nuclear negotiations, which might well not have happened were it not for tight oil. When strict sanctions were imposed on Iranian oil exports, many feared that world oil prices would spike, and that the sanctions would ultimately fail, owing to insufficient alternative supply. But the increase in US oil production over the last two years has more than made up for the missing Iranian output, enabling the sanctions (bolstered by parallel financial measures) to work impelling Iran to negotiate seriously, which it was unwilling to do only two years ago.In Arab capitals, anxiety is mounting that a rapid increase in US tight-oil production will fuel wholesale US disengagement from the Middle East. But this overstates the extent to which direct oil imports shape US policy toward the region. To be sure, rising US output, combined with greater