Five years ago, peak oil theorists predicted that global production would soon hit its high-water mark and then decline inexorably, with the U.S. growing even more dependent on overseas energy imports. Those trends seemed to play into Putin’s hands. What he didn’t anticipate was that U.S. oil production—thanks to horizontal drilling and hydraulic fracturing technology, in which pressurized water and chemicals are blasted into rocks to release energy—would increase 46 percent. That equals the entire output of Nigeria, estimates Daniel Yergin, vice chairman of consulting firm IHS. “Think of it like a non-OPEC country appearing in North Dakota or southern Texas,” Yergin told executives at the St. Petersburg forum in June.
Between now and 2018, North America will provide 40 percent of new supplies through the development of light, tight oil and oil sands, while the contribution from the Organization of Petroleum Exporting Countries will slip to 30 percent, according to the International Energy Agency, which also sees the U.S. emerging as the biggest oil producer by 2020 and a net exporter of oil by about 2030. Meanwhile, the agency trimmed global fuel demand estimates for the next four years.
The U.S. is also on pace to add 2 trillion cubic feet per year of natural gas once three just-approved LNG projects start operating, an 8 percent increase in total U.S. capacity based on 2012 production levels. More LNG facilities are coming onstream in Australia, South Korea, Mozambique, and Tanzania. Yergin predicts natural gas, both conventional and liquefied, will be the No. 1 energy source by the end of 2030.
Russia’s worry is twofold: An expanding supply of affordable LNG, which is transported by ship, is forcing Gazprom to either cut prices or lose share. (Weird and surprising fact: As American utilities shift to gas, displaced U.S. coal is flooding into European markets. The U.S. may supplant Russia as the world’s No. 3 coal exporter by yearend, according to Goldman Sachs (GS).) Second, the Russian gas giant is under pressure to adopt spot-market pricing instead of tying its prices to oil. In June, Gazprom agreed to revise its gas contracts with German utility RWE after losing an arbitration case; it’s renegotiating supply contracts with other utilities, including Eni (ENI:IM) and EconGas. The European Union is also drafting an antitrust complaint against Gazprom for abusing its dominant position, say three people familiar with the probe who asked not to be named. The company declined to comment. Longer term, the Russians may even have to contend with shale energy assets being developed by Western oil majors in Poland, Ukraine, and Lithuania, all Gazprom profit sanctuaries.
If you don't preview the impossible and just make your rationale on what is possible today, than you will never have a clear vision about tomorrow
if US production plants in for example the petrochemical sector are LEAVING china (as do carmakers) and are going back to the US it is because of the low energyprices now that fracking is there
if the US Is making more new jobs than ever before and its tradebalance is swifting it is because there is fracking
if the Middle East dictatorships with all that oil can't blackmail the US anymore with cutting oil or driving up the prices, it is because there is fracking
if Putin has now more internal economical and financial problems than he can deal with, it is because of fracking
fracking gas and oil made the consultants freak out about their predictions
only there are billions invested at some time solely based upon their experience, insight and vision
(at the same time look at the downfall of the BRIC countries that is happening every day before our eyes because they just reaped the money for years while our so bright industralists offshored our production and are now faced with a very difficult situation as those countries with little oil production have to import oil in odllars while their currencies are sliding away every day making energy coests higher every day)