N. America Shale Oil Boom To Put Pressure On OPEC
From Fox Business
BP’s forecasts illustrate the extent to which the North American boom, first in shale gas production and now in shale oil, has redrawn the global energy map. However, the company doesn’t expect the shale revolution to spread by 2030 on any great scale to Asia or Europe, where conditions for investment in unconventional oil and gas fall short of those in North America, BP said.
In the U.S. alone, shale oil production is expected to grow around 5 million barrels a day by 2030, said BP’s chief economist Christof Ruehl. This is likely to be offset by reductions in supply from the Organization of the Petroleum Exporting Countries, which has been pumping at historical highs in recent years to compensate for output losses in Libya due to the civil war there and more recently to compensate for Iranian sanctions, he added.
“This will generate spare capacity of around 6 million barrels a day, and there’s a faultline if there is higher shale [production] then the consequences would be even stronger,” he said.
OPEC spare oil production capacity last exceeded 6 million barrels a day in February 2002, when the price of U.S. crude benchmark West Texas Intermediate averaged just under $21 a barrel, according to data from the International Energy Agency.
