As I See It text
Is this a watershed moment?
Watershed moment: A critical turning point in time where everything changes so that it will never be the same as before.
In this video interview, Daniel Yergin, vice chairman of IHS Markit and Pulitzer Prize-winning author, spoke with Hart Energy about his latest book and the industry.
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y definition, it’s impossible to definitively answer this question. Watershed moments, of course, are usually deciphered in hindsight. But what the heck, let’s throw caution to the wind and try to look ahead anyway.

I had been pondering this question in my mind for the better part of autumn, and then I got the chance to ask it directly to someone who understands much more about the oil and gas industry and its history than me. So I asked Daniel Yergin, the vice chairman of IHS Markit and Pulitzer Prize-winning author, during a one-on-one video interview about his latest book, “The New Map: Energy, Climate and Clash of Nations,” as well as the industry as a whole. Not surprisingly, I got a very insightful and even more thought-provoking answer.

“Yes, in the sense that the energy markets are going to be competitive in a way that they were not before. They’ll be competitive with wind and solar, competitive with electric cars,” he said, reiterating, however, all of this will take quite a bit of time. “I think that’s a very interesting way to see it. It is a much more competitive landscape, and public policy is going to be much more active in it. Companies will adapt to that, but I think if wind and solar took a long time, carbon capture will have to be part of it because oil and gas are going to be a big part of the energy mix in 2040 and 2050.”

So maybe we are in a watershed moment but just the beginning of it? I’ve started to see it that way of late. The industry’s watershed moment is sure to last two to three decades, at least.

There is no doubt things are changing. The energy transition is in full swing.

As Yergin pointed out, solar and wind technologies actually began to take shape in the early 1970s but took 40 years or so to come to market. Now they are a very competitive part of the energy market.

While I think we are in a watershed moment—and, of course, only time will tell for certain—there’s still plenty of business to be had, particularly when demand for oil and gas in China, India and the developing world is still growing.

As Yergin discussed with me in the video, some 3 billion people still live in energy poverty. There’s an interesting quote in his book from the Nigerian petroleum minister in which he said his country has a lot of people whose income needs to be improved, whose health needs to be improved, and they have to get natural gas to them.

We live in a modern society that wants quick answers and resolutions before it’s time. Some impatient people like me even want to get answers to questions that only hindsight can illuminate. But energy is an industry that requires patience. We all know that from the cyclical nature of the beast throughout its history.

So expect this moment to last quite a long time.

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Len Vermillion
Editorial Director
lvermillion@hartenergy.com
“I think that’s a very interesting way to see it. It is a much more competitive landscape, and public policy is going to be much more active in it.”
—Daniel Yergin, IHS Markit
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