Vacation season was in full swing this summer and Americans were on the road. Gasoline stayed under $4 a gallon, as people feared it would be back in February when oil was above $100 a barrel.

You can pull your fifth wheel into the campground; take that new boat for a spin on a smooth-as-glass lake in Maine, spot American eagles while on a cruise in Alaska. These are the fruits of a healthy oil and gas industry. No prohibitive prices. No fuel shortages.

Maybe it is a good thing that the U.S. has no formal energy policy. There is the Energy Policy Act of 2005, signed into law by President George W. Bush. Not much but hot air since then—and a lot of hot air now blowing on the presidential campaign trail about U.S. energy policy.

It is not the politicians who have made this plentiful energy possible. The free market has done its job, freeing up U.S. producers to do what was recently unthinkable: uncover a century's supply of natural gas and increase domestic oil production.

Since last October, U.S. oil output has risen 6% to reach 6 million bbl. per day —a level not seen since 1998, according to the U.S. Energy Information Administration (EIA). The sources of this happy news are wells in the Bakken, Eagle Ford and deepwater Gulf of Mexico.

Early data from the EIA show that the Bakken and Eagle Ford combined have already reached 1.23 million bbl. of oil a day. During the recent $1.7-billion Central Gulf of Mexico lease sale, Norway's Statoil alone bid $157 million to win a single block that it apparently wanted badly.

So let us remember to let the free market reign.

When you do, this is what you get: North Dakota surpassing Alaska in oil production. In April, it produced 18.2 million bbl. of oil, a vast increase from 10.5 million in the same period in 2011. In May, Texas produced an estimated 33 million bbl. of oil and 540,627,465 Mcf of gas-well gas. In June, the state issued another 1,950 drilling permits.

That bad, eh? No thanks to the feds, but the oil and gas industry is sure doing its part to get us beyond the Great Recession.

If one waits on the government for any stimulus, one is likely to wait a long time. In New York—desperate for more jobs—debate continues on whether oil and gas companies will be allowed to frac gas wells in the state's so-called Southern Tier—the scenic rural counties near the northern Pennsylvania border.

Regulators have had to wade through more than 60,000 public comments for and against hydraulic fracturing. New York Gov. Andrew Cuomo's (D) decision on proposed drilling regulations from the New York Department of Environmental Conservation was supposed to come sometime this month.

It is the fashion these days to say that North America is the new Middle East. In terms of surging oil production, that may not be a stretch. New EIA administrator Adam Sieminski (who has covered the business for 40 years and most recently was the lead oil analyst with Deutsche Bank) now says the U.S. may be energy-independent by 2035.

However, in the free markets of the U.S. and Canada, producers will eye the bottom line. They will produce their oil when it is economic to do so—they do not have to produce due to government dictates from above, or to fund social programs that they hope will quell civil unrest, as is the case in some Middle Eastern countries.

Still, the facts on the ground are startling. By the end of this year, North Dakota and Montana could be producing as much as 750,000 bbl. per day from the Bakken and Three Forks plays. Texas—thanks to the Eagle Ford and all the rich Permian plays—will add 500,000 bbl. of oil per day this year, and could do so again in 2013—and again in 2014, according to Ed Morse, managing director and global head of commodities research for Citigroup Global markets.

Oil is the next revolution, says Leonardo Maugeri in a June paper from the Belfer Center for Science and International Affairs, at Harvard's Kennedy School. He says the world is not running out of oil, but there are mounting problems in evaluating the new supply, which is likely to be underestimated.

Based on original, field-by-field analysis, Maugeri estimates that by 2020, the world could produce an additional 29 million bbl. per day of oil and natural gas liquids, risk-adjusted.

As horizontal frac methods spread worldwide to new fields and revive older ones, he adds, there could be a glut that leads to much lower oil prices.

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