Guest blogger Lisa Margonelli: A short history of the future of British oil

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In 1988 I drove more than a thousand miles on a whim-fueled road trip to see an ichthysaur skeleton. The dirt cheap gas that enabled this ridiculous and ultimately unsuccessful project (the ichthysaur was closed when I got there) was partly and indirectly provided by the Forties Pipeline in the UK's North Sea, which was just closed by a strike at a Scottish refinery.

Few Americans know anything about the Forties Pipeline, but it enabled all of our road trips, changed history, and encouraged some unrealistic expectations. If today's already stressed out oil market heads beyond the stratosphere on news of the strike, the Forties may again be a game-changer, so I thought I'd give a short tour of the past.

The Arab Oil Embargo of 1973 raised prices and scared oil consuming countries, who realized that outsourcing their oil supplies had left them vulnerable. Western Europe only produced half a million barrels of oil a day in 1974, importing everything else. The oil consuming countries decided to drill for more oil at home, to lessen their dependence. The Forties (named after the part of the North Sea it was located in) was the first really big field that the UK drilled in the North Sea. (Read a scary story about the difficulty of drilling in the North Sea.)

In 1975, the British energy minister waved a bottle of oil from Forties and said it was "Britain's future" and then Queen Elizabeth herself flipped a symbolic switch to start production. (Probably wearing color coordinated gloves — See the queen flipping the original switch here.) By 1985, the North Sea was producing 3.8 million barrels a day. North Sea oil did change Britain's future, and it also played a key role in the establishment of the oil spot market and the futures markets, which meant that A. embargoes became impossible because consumers could buy from other producers, and B. anyone could get upset about the price of oil simply by reading the paper. (Before the mid-1970's oil prices were set in long term contracts and were basically secret agreements.) More drilling and new technology meant that oil output from the North Sea continued to grow, and grow and grow until it was 9 percent of the world's oil production, around 6 million barrels a day in 1999. (For a dated version of the IMF's take on this history, click here.) And then North Sea production began to fall. In 2006 it was 4 million or so. Now it's less.

The Forties, the North Sea, and many other non-OPEC fields created a market that was favorable to consumers, allowing us to forget about vulnerability and concentrate on using gasoline, counting on the oil market to even things out. But as many of the non-OPEC producers see their production taper off, the era of cheap gas that the Forties ushered in is ending. The bulk of remaining oil reserves are under oil producers, who are working to make a market that favors them, which means high prices for us.

My question is: What is the next Forties, the next geo-techno-political concept that will change the way the energy game is played? In other words: If you could give Queen Elizabeth a new button to push, a switch that would start a new era, what would it be?

Lisa Margonelli is an Irvine Fellow at the New America Foundation and author of Oil On the Brain: Petroleum's Long Strange Trip to Your Tank.