Bright lights, big oil field in North Dakota. (Larry Mayer/AP)

In the past five years, warnings about peak oil have gained a lot of traction. U.S. oil production, after all, has fallen sharply since 1970. Global oil output has plateaued of late, even as China and India are demanding ever more crude. And that’s all caused prices to soar.

Yet the recent shale-oil boom in North Dakota has some analysts brushing off this gloomy perspective. A new research note (pdf) from Citigroup argues that the recent surge in North American production has “buried” the peak-oil hypothesis. New drilling technology has allowed companies to extract oil from once-inaccessible shale rock, which has, in turn, allowed the U.S. to slash its oil imports dramatically. What’s more, there are tantalizing shale deposits all around the world — in Argentina, Australia, and even France. So does that mean that, as the Citigroup analysts say, the peak-oil hypothesis is “dead”? Well, not so fast.

Now, one reason that the United States imports so much oil is that many of its domestic fields, in places like Texas and California, have been in steep decline for decades. Back in 1970, the United States churned out 10 million barrels of oil per day. Now? We produce just 6 million. The Citigroup analysts expect that new shale oil plays, if combined with further exploration in the Gulf of Mexico and Alaska, could add 3.5 million barrels per day between 2010 and 2022. But as long as other domestic fields keep declining, the shale boom won’t be enough to get back to our peak. The industry will have to drill furiously simply to maintain the status quo. (Indeed, the International Energy Agency sees U.S. oil production rising briefly to 6.7 million barrels per day and then sinking back down to 6.1 million barrels through 2035 — about where we are today.)

What’s more, there are a lot of assumptions in Citigroup’s analysis that are far from certain. Take the decline rate. Conventional oil fields typically see a drop in output of about a 5 percent to 8 percent rate per year. But, as some companies working in the Bakken field in North Dakota are now discovering, shale oil can dwindle far more rapidly than that. One oil executive tells Foreign Policy’s Steve LeVine that oil wells in the Bakken field can decline by more than 90 percent in the first year, leveling off at 8 percent per year thereafter. Once a well dries up, the company has to move over to a nearby spot in the field. That’s a lot of new drilling. And all that drilling is pricey. Which means, the executive notes, that if the price of oil were to suddenly drop, a lot of companies could quickly go bust and production could dry up in short order.

The other thing to note here is that greater oil independence is no guarantee that the United States will be immune from world events. As my colleague Steve Mufson observes, the United States now imports 15 percent less oil than it did in 2005. Yet prices remain sky-high — in part due to global factors like Chinese demand and tensions with Iran. Indeed, the $326.5 billion that the United States paid for foreign crude in 2011 was its second-highest total ever — just slightly less than in 2008. Granted, that import bill would have been even larger without the shale boom, but it’s a handy reminder that “oil independence” isn’t the same thing as cheap gasoline.

Add it all up, and America still has plenty of reason to reduce its reliance on oil of all sorts, foreign and domestic. A big reason why U.S. oil imports have shrunk since 2005 is that our gasoline use has plummeted. Part of that is due to the grinding downturn, part of it is the fact that people are (slowly) purchasing more fuel-efficient cars, and part of it is that Americans are driving less. And there’s little reason to think that reducing oil use will become somehow less important in the years and decades ahead.