US and Israel War Against Iran Fuels Energy Boom in the Americas

The conflict involving the United States and Israel against Iran is significantly disrupting the global energy market, paradoxically creating a new energy powerhouse across the Americas. As concerns over prolonged supply disruptions in the Middle East escalate, a worldwide race for alternative energy sources is driving a surge in oil and gas production and exports throughout North and South America. According to Rystad Energy, total oil and gas output in the Americas is projected to increase by 10% within two years, by December 2026, with countries from Canada to Brazil already breaking production records. This shift is largely triggered by the loss of over 2 billion barrels of crude oil from global markets due to severe attacks on energy infrastructure and tankers in the Strait of Hormuz. These disruptions have caused sustained price hikes for oil, liquefied natural gas, and fuel distillates, prompting nations and investors to seek stability far from the Middle East.

Seven months into the conflict, the Americas are coalescing around what U.S. President Donald Trump refers to as the "Donner Doctrine," emphasizing reliance on an American-led sphere of influence rich in energy resources, capable of counterbalancing the unstable power centers of the Middle East. The United States is at the forefront of this transformation, having increased its crude oil and distillate exports, such as diesel, to Europe, Asia, and Oceania by 15%. Wood Mackenzie forecasts U.S. oil production to reach approximately 11.8 million barrels per day by December 2027, an increase of about 1 million barrels per day compared to pre-war levels.

Concurrently, Washington is working to reintegrate Venezuela into the global energy map. Following the capture of former leader Nicholas Maduro in January, U.S. authorities have encouraged international companies to invest $100 billion in the country. Venezuela's production has already jumped 10% this year to about 1.2 million barrels per day, with Chevron committing an additional $7 billion in investment, alongside preliminary agreements from giants like Shell, BP, and Adnoc from the UAE.

In South America, Argentina is emerging as a major beneficiary. A decade of development in the vast Vaca Muerta oil field, coupled with investment-encouraging policies under President Javier Milei, has propelled the country's total exports above $10 billion in September. TotalEnergies has announced a massive $10 billion investment, American oil magnate Harold Hamm has initiated multi-billion dollar drilling campaigns, and Chevron plans to invest $13.8 billion in the El Trapial field to triple its output in Argentina. This initiative receives direct financial backing from Washington, with the U.S. Export-Import Bank approving $7 billion in financing for energy development in Argentina.

Canada is also positioning itself as a pillar of stability. Governor Mark Carney's government aims to transform the country into an "energy superpower," with a survey by ATB Cormark Capital Markets indicating that nearly 80% of institutional investors are now more inclined to invest in Canadian energy due to Middle Eastern risks. A consortium led by Shell has already approved over $20 billion in investments to double the capacity of the LNG Canada facility, while oil pipeline projects from Alberta to the West Coast are expected to receive approval.

While the Americas cannot entirely replace the Middle East's low-cost oil, the rapid increase in production is moderating global price increases and eroding the future pricing power of OPEC and Gulf nations, particularly Saudi Arabia. The war against Iran is reinforcing the notion that in the new geopolitical landscape, geography and stability are becoming as critical as geology itself.