At a critical Friday meeting in Vienna, the Organization of the
Petroleum Exporting Countries (OPEC) will set production policy. For the
first time, they will be grappling with the challenges of shale oil,
even none of the member states are major shale oil producers.
The shale boom began in the U.S. as a ripple in North Dakota and
Texas. Some thought its impact would be limited and regional, not
global. Now that uptick on our domestic production curve has triggered a
tsunami with geopolitical implications.
That’s because the U.S. does not need 100% energy independence to get
OPEC’s attention. Due to production but also conservation and a
protracted recession, our need for imported oil has contracted from
60-70% of consumption to about 40%, headed south. As the world’s largest
crude oil market, changes in our domestic supply picture must
necessarily reshuffle the import mix. Remember how skeptics argued that
the shale boom is “a mirage“? I have often maintained
that domestic supply increments of 500,000 barrels per day can be
significant in a worldwide 90 million bpd marketplace. We’re starting to
see that play out, albeit in some surprising ways.
READ MORE: http://www.redstate.com/2013/05/31/shale-oil-boom-rattles-opec/
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