Power of OPEC broken: US changing the balance of power in oil and gas production

Rick Moran

Estimated US shale oil reserves keep going up and the world is about to change because of it.

Over the next five years, the US will account for a third of new oil supplies, according to the International Energy Agency (IEA).

The US will change from the world's leading importer of oil to a net exporter.

Demand for oil from Middle-East oil producers is set to slow as a result.

"North America has set off a supply shock that is sending ripples throughout the world," said IEA executive director Maria van der Hoeven.

Canadian oil sands production is also contributing to the "supply shock", the IEA said.

The surge in US production will reshape the whole industry, according to the IEA, which made the prediction in its closely-watched bi-annual report examining trends in oil supply and demand over the next five years.

The IEA said it expected the US to overtake Russia as the world's biggest gas producer by 2015 and to become "all but self-sufficient" in its energy needs by about 2035.

The rise in US production means the world's reliance on oil from traditional oil producing countries in the Middle East, which make up Opec (the Organization of the Petroleum Exporting Countries), would end soon, according to the report.

The only thing that can get in our way is Obama's EPA. The greens may seriously crack down on fracking, shutting down thousands of new oil and gas fields:

The sharp rise in US oil production is largely thanks to shale oil, a product many have hailed as the saviour of the US energy market.

Fracking, the process of blasting water at high pressure into shale rock to release oil (or gas) held within it, has become widespread in the US.

But critics of shale oil point to environmental concerns such as high water use and possible water contamination, the release of methane and, to a lesser extent, earth tremors caused by drilling.

Several recent studies have shown fracking to be safe for the environment - as long as it is done properly. Certainly this requires a degree of oversight by the states and the federal government. No one wants oil, methane, or gas in their drinking water which can be one one of the consequences of poor management.

But the greens aren't concerned with oversight. They want to shut down the fossile fuel industries in America. They are apparently going to get their wish with coal. They must be prevented from damaging the oil and gas industries as well.

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Thursday, May 16, 2013