Good Use of Your Holiday Gift Card (Before it Vanishes Behind the Fridge)

Good read: During our holiday newsletter hiatus, I finally had time to read Meghan O'Sullivan's book (pictured above) about how the shale boom is shaking up global oil-and-gas markets — a phenomenon that has broad and important geopolitical effects.

The boom benefits U.S. global posture and economy, but O'Sullivan warns that policymakers cannot be complacent and must take steps to harness its geo-strategic benefits while mitigating environmental risks.

Why it matters: The book offers a fascinating and lucid analysis — interspersed with interesting vignettes from O'Sullivan's globetrotting career as a Harvard energy and international affairs expert who served in the George W. Bush administration — of the many international and domestic effects of what she terms the "new energy abundance."

A couple of the interesting themes include:

• The energy abundance is putting new pressure on Russia. It won't end Europe's heavy use of Russian gas, but does alter the balance of power as European countries have more supply options and the increased LNG trade is creating more of a buyers market. It strengthens the hand of China, meanwhile, in Sino-Russian relations.
• Speaking of China, the book explores several ways it's affecting China's posture and policy. Here's one: The seismic shift from 10–15 years ago, when concern about growing competition for dwindling resources was all the rage, means there's less motivation for China to seek direct supply and equity deals with human-rights abusing regimes and shield them from international pressure. Instead, China is more comfortable relying on markets.
• Perhaps counter-intuitively, the bonanza of oil-and-gas could eventually increase overall global reliance on Middle Eastern supplies, because in a lower price environment, sources of oil in other parts of the world with high development costs are less attractive to produce.
• On climate change, she says the shale gas boom that has helped to lower U.S. emissions by displacing coal helped to bring the major 2014 U.S. emissions deal with China that paved the way for Paris a year later. Another interesting point: O'Sullivan warns that abandoning the Paris deal might ironically hurt the U.S. shale boom, because less global climate coordination could bolster coal internationally at the expense of U.S. LNG.

Go deeper: The New York Times reviewed the book last week.