U.S. to Become World's Top Gas and Oil Producer by 2015, 2017

Thanks Obama

 

I am not an energy expert but I know there are several on here. Here are a couple of questions that I have regarding this topic.
1. While the US might produce enough oil domestically to eliminate the need to for imports how will that affect price when oil is on a global market?

2. My understanding of the recent oil boom in the US is due to things like tar sands and shale oil which are more energy intensive to extract and require more refining than the light sweet crude from Saudi Arabia. How much cost competitive then is US oil compared to oil from other regions?

 

If saudi wanted to they could crash the oil market to make sure this doesn't happen.

 

Also not an expert, but believe this to be true:

1. Oil will still remain a global market. Huge increases in supply would reduce prices, but globally...not to US customers only.

2. The new horizontal and shale wells are more costly and energy intensive than standard, vertical wells, but we are also seeing extremely prolific wells come from this development. They are at no real disadvantage. Canadian Oil Sands, on the other hand, are extremely expensive to both extract and refine, putting it a significant disadvantage to other sources of oil. That said, even oil sands oil can be extracted for significantly less than the current price of oil. Also, you can't help but think that someone will innovate and find a good way to effectively extract the oil sands, just like people were able to do with shale rock.

 

This is good news for cities near sea level.

 

Obama sucks, why hasn't he told the Indian guy that owns the gas station I go to, to drop the price of gas to $1.00/gallon?

 

There's a sucker born every minute.

 

the more produced the cheaper the price. Yes we still pay a global price althoug right now the nymex based in oklahoma is cheaper than brent base d in the north sea i think. we already lead in production of refined fuels. This is why the keystone pipeline is important. Crude from canada to be refined in port author. This leads to the second questions. Tar sands is canadian. US production has increased due to technological advances that allow more production in the same fields onshore and deeper water offshore.

 

Becoming self-sufficient for a decade or two would give us a chance to build alternative energy sources, reduce our addiction to oil and gas. It means we need oil prices to stay relatively high, but I'm all for it if we can cut oil imports to close to zero. China's demand, as well as India's, going forward, should help keep oil prices high enough to make our more expensive extraction costs worthwhile. The days of the "free ride" on cheap oil are over, people. If higher prices make us energy independent, so be it. It would be a huge boon to our economy, as well as our foreign policy, which is so tied to our massive consumption of foreign oil. In my opinion, anyway.

 

Underlining all this is the fact that US consumes over 30% of the world's energy, with the next country consuming roughly 1/4th of that (China) and the next one 1/6th of that (Japan).

Basically it would be unsellable due to cost, so you would have to consume all your own. I'll also add that this projection is not only based on shale oil/gas, but also on alternative energy that is being developed by your government.

By virtue of being the most expensive oil to extract, the US wouldn't naturally become competitive on the global market. If the US chooses to cover its own needs with its own supplies, then demand for oil will drop sharply and therefore price will drop sharply and the US oil/gas becomes even less competitive. If it chooses to continue consuming global oil/gas, its own supplies will still be priced out of the market. The Chinas and the Indias of the world will not increase demand fast enough to make this a smooth process IMO.

I think one likely scenario which reconciles with traditional US behavior is that they will increase the cost for others. Generally speaking, the large oil producers do not discover, extract or refine much of their own oil so companies in the US and US-allies can start pushing the cost up.

If this happens, I expect a massive war. This is particularly likely since US interests in oil-producing areas will be less valuable, and NATO would have very little or nothing to do once the US becomes energy self-sufficient. Many countries would be looking at a sudden downward shift in standard of living. In my opinion it will also coincide with our next global financial crisis around that time.

 

Oil will run out in ~ 50 years.

When I put my tin foil hat on, I feel that there is a secret mandate passed among US presidents to hold out on domestic oil production for as long as possible. The countries who run out first will collapse, the ones left with reserves will run the world.

 

That just not true. There is a lot of oil. It wasn't profitable to get it when it was 40 bucks a barrel. It is when it is a 100 bucks a barrel.

 

Mother Russia disagrees:

http://www.volusia912.org/html/peak_oil_theory.html

 

In a refinery largely owned by the Suadi Arabian government. Which happens to be the larget in the country.

Funny how thing work.

 

Texas! Heck yea!

 

hypothetical conversation on Texas joining OPEC from CNBC:

http://money.msn.com/top-stocks/vid...rom=mpl_en-us_cp_en-us_Money_video-top-stocks

 

Who cares? A foreign country wants to spend a bunch of their money and hire a bunch of our workers to build an expensive, valuable, not-moveable thing in our country? Big win for us! Besides, it's just a refinery for a commodity - it's not like strategically valuable technology is changing hands.

Anyways, these hydrocarbon findings are great news. Pump it out, sell it up, and let's make some money!

 

It's not like we get the majority of our oil from the M.E., about 2/3rds comes from North America.

 

Don't buy it, even so both the Federal and the local producing state governments should make sure to curtail production to avoid Spindletop like depletion; and feel completely justified in claiming mineral rights for a large acreage of land to create some kinds of Permanent Funds like Texas. Also, producers should be allowed to export as much as they can if it's more profitable.