There was a report in yesterday’s The Times (sorry no link, Times Online is a pay site) regarding the soaring production of shale oil in the US. BP forecasts that this year the States will overtake Russia and Saudi Arabia as the world’s largest producer of oil, most of it from rising shale output. Understandably, OPEC is not amused and will have to cut production to avoid a collapse and keep prices steady.
The loss of hegemony for OPEC in the oil market can only be good for consumers. Analysts predict that the price of a barrel of oil will drop by 20% in the next decade. Europe seems to be lagging behind in the development of shale reserves because of environmental concerns, fracking bans and lack of infrastructure.
The shale revolution has thrown on its head, for the time being anyway, the general consensus that global oil production is in decline. While welcoming the fact that the Arabs are squirming, the Middle East might become a more volatile place in the upcoming years.
Boadicea's Chariot 
It would be a pleasure to see a Saudi raghead princeling queuing for the bus to Soho in rainy Londonistan on his annual Ramadan avoidance leave rather than driving his Ferrari down The Mall at stupid MPH whilst waving his ‘diplomatic’ passport at the plod.
OZ
Nicely put, OZ. All empires come to an end and the sooner the OPEC cartel falls the better.
Good morning TR: There hasn’t been much of an alliance between the US and the Saudi’s for quite a while, despite the opinions of the tabloids. US consumption is about 18.6 Million bpd of which Saudi Arabia provides 1.4 Mbpd (a massive 7.5%) and this number has dropped by 20% in the last five years and is still falling.
Overall US imports are down about 50% since their peak and currently run about 40% of total consumption. The largest outside supplier by far is Canada which provides about 10% of consumption.
Fracking and oil shale extraction will totally change the equation here, the latest projection is that the US will be self sufficient in oil and gas before 2030. Here’s a couple of recent links.
http://www.usnews.com/news/articles/2013/01/16/bp-shale-boom-key-to-us-energy-self-sufficiency
http://www.bloomberg.com/news/2013-01-16/u-s-to-become-largest-liquid-fuels-producer-in-2013-bp-says.html
We live in interesting times.
Thanks for the links, LW. Reports of the impending demise of America’s Imperium have been grossly exagerrated.
TR: Well I would not go quite that far, but at least we will not be freezing in the dark. 🙂
The jolly thought of ragheads murdering each other in gay abandon and increasing quantities quite resigns one to the incipient environmental degradation of the Ogallala aquifer.
Nearly!
Christina, “the incipient environmental degradation of the Ogallala aquifer” – is thare an English version available? 🙂
Well then, with a tad more broad based linguistics.
Fracking fucking the water supply!
The disgusting chemicals have to be piped though the water supply to get to the gas holding shales.
One big basin ( = syncline) holds both types of strata, the gas below the water. They ain’t too fussy retrieving the chemicals, ooops! There go the cows, the kids, the crops!
Big basin=Ogallala aquifer. covers 70% of the midwest.
Very nasty when it all goes pear shaped.
One can only hope the payback is in sufficient headless turbans rotting in the dessert.
On further thought it will ultimately result in desertification in both locations. The ragheads will no longer be able to afford desalination and the midwest will turn back into marginal desert land as it was before irrigation from below.
Mexican stand-off! Score 0-0.
Reblogged this on SMIPP Ltd..