The recent plunge in the global crude oil price down to near $85 a barrel — a 20 percent drop from June — has everyone talking, from Washington and Wall Street to London and Riyadh. What does it mean for the U.S. economy and the currently booming U.S. oil industry?

Oil prices rise and fall, but this fall might signal a massive shift in the global balance of energy power. For once, it stands to favor the United States and Western-style democracies, and harm the autocrats and despots who run the Organization of Oil-Exporting Countries or OPEC, as well as Vladimir Putin and Russia.

There’s been breathless media speculation that the fall in oil prices may reflect a decision by Saudi Arabia to force the price as low as it can go, in order to undercut America’s oil shale bonanza. The U.S. is on track to replace the Saudis as the world’s largest crude producer by 2020, but the Saudis can push the price as low $10 per barrel and still make money. And so, the argument goes, perhaps they’re hoping a sharp price plunge will make shale production in places like North Dakota and the Permian basin in Texas unprofitable.

But in fact, the Saudis aren’t that stupid. They know most American oil producers will still be in the black even if the price falls as low as $60 per barrel. And at that price, their own affluent one-product economy will become unsustainable, as will those of other OPEC players such as Kuwait and the United Arab Emirates.

The cause of the current plunge has been this year’s global economic slowdown, especially in Europe and China. Demand has fallen off and crude oil has glutted the world market. Prices will stay low as long as the world’s economic system remains in low gear.

But that system will be the first big winner in this current oil market. A sustained drop in the cost of energy means lower costs both for consumers and producers. Look for world economic growth to get a big shot in the arm in 2015 from what’s been happening this summer and fall.

The other big winner will be the U.S. consumer. Americans are already seeing the impact at the pump, with gas prices averaging $3 a gallon. If the price of Brent crude falls to 80 dollars a barrel, that’s the equivalent of a $600 annual rebate for every American household — and a $1.8 billion daily windfall for the world economy.

The third big winner, paradoxically, will be the U.S. oil industry. Fears that the price plunge will force cutbacks in production appear very premature. In fact, if Congress gets its act together and lifts its forty-year old ban on oil exports, we could actually see a spurt in production as we begin exporting our light tight crude, which refineries in Europe, Japan and other industrialized Asian countries prefer to the sour, heavy crude that flows out of OPEC’s Gulf states.

Indeed, OPEC’s biggest players stand to lose the most in this crude price drop. It doesn’t just mean sharply lower revenues for the Saudis, Kuwaitis, and Iranians — not to mention the renegade producers of ISIS. It puts OPEC in a painful dilemma. The only way to sustain a higher price than $85 per barrel will be to cut production; but if world demand continues to fall (and in the United States the demand for OPEC-imported oil has fallen by nearly 40 percent, thanks to shale), even that won’t prevent prices from falling further. The Saudis have already signaled that they are going to pump more oil, despite the price drop.

This means the rationale for OPEC’s cartel pricing is beginning to fall apart.

The other big loser in the current oil price plunge is Russia. As Citi’s energy analyst Ed Morse notes, Vladimir Putin needs oil prices well over $100 a barrel to keep Russia’s version of Big Oil, Rosnoft, profitable. We are already significantly below that number; and since the Kremlin gets more than half its revenues from oil and gas sales, the current fall in prices in both commodities world-wide spell big trouble for Putin’s big plans for expanding Russia’s military — and for the Russian economy.

It’s too early to predict the death of Putin’s energy empire, or of OPEC. But as global economic forces realign themselves with this oil price drop and the emergence of America as the world’s biggest oil and gas producer, it might be worth looking into funeral arrangements.

Arthur Herman is a senior fellow at the Hudson Institute and author of Freedom's Forge: How American Business Produced Victory in World War Two. He can be reached on Twitter @ArthurLHerman. Thinking of submitting an op-ed to the Washington Examiner? Be sure to read our guidelines on submissions for editorials, available at this link.