The hydrocarbons in oil shale can be used as an alternative to petroleum or natural gas. ", "These technologies destroy the environment," he explained via a translation, before adding that the areas affected by the extraction process were typically left in a "precarious situation.". Mikhail Svetlov | Getty Images News | Getty Images, Shale Bonds: The new way oil drillers are raising capital. Sign up for free newsletters and get more CNBC delivered to your inbox. But in terms of shale gas reserves, America is not the biggest shale oil … The rapid growth of the U.S. shale industry is at the heart of a Russia-versus-Saudi Arabia crude-oil price war that threatens to upend a global economy already under threat from the spread of … And then there's the return of US shale oil, which has also offset OPEC's cuts. Russia will probably eventually decide that the pain is too great, and come back to the table. A devastating global pandemic and a reckoning with Wall Street appear to have broken the resolve of the shale wildcatters who turned the U.S. into the world’s biggest oil producer. Russia’s central bank reported last year that an oil price of $25 per barrel—a number much likelier now than when this forecast was made—would push Russia’s economy into recession. The firm’s interventions span international security, economics, law, politics, terrorism, and crime and corruption. Instead, OPEC boosted output in order to protect its market share and drive out higher-cost competition in North America (and Iran). It is all because of US unconventional shale oil and gas. Russia’s central bank reported last year that an oil price of $25 per barrel—a number much likelier now than when this forecast was made—would push Russia’s economy into recession. I am a Senior Fellow at the Atlantic Council and the Founding Principal of International Market Analysis, a Washington, D.C.-based global risk advisory boutique. Furthermore, the 25% plunge in oil prices, with its negative impact on American shale producers, is likely to complicate the perspective of re-election for Donald Trump, who has championed the oil and gas sector, growth of the domestic economy, and employment. However, there are potentially huge reserves elsewhere. That trend continued as the US surpassed both Saudi Arabia and Russia as … Got a confidential news tip? U.S. shale energy production is on course to overtake the output of Russia’s entire oil and gas sector by 2025, influential new forecasts have shown. March 6 2020 Just as the coronavirus outbreak wreaks havoc on the oil market, Russia has spotted an opportunity to hurt rivals in the US shale patch. More than 120 American companies filed for bankruptcy between August 2015 and May 2017, while the number of active drilling rigs plunged by a half. All Rights Reserved. Yet Russia already pumps more conventional oil supply than Saudi Arabia at around 10.3 million barrels per day and may look to shale to maintain rather than revolutionize production. Russian President Vladimir Putin talks during the Russia Calling! Russia has become the biggest global producer of crude oil with almost no contribution from shale, a sometimes technically difficult and expensive resource to … This is a familiar attempt to protect market share and to squeeze out American shale and other higher cost producers, breaking up a quasi-cartel arrangement with the Kingdom. For 22 years, I was the Heritage Foundation’s leading Russia/Eurasia and international energy expert. In October 2019, Russia’s Finance Minister Anton Siluanov claimed that the country would be able to sustain the effect of the oil price drop to $20 or $30 per barrel for three years, thanks to the National Wealth Fund (currently valued at over $170 billion) and stricter fiscal regulations, which allowed Russia to balance its budget based on the lowest break-even oil price in a decade. As shown in the next table, in terms of shale oil reserves, the number one country as reserves of shale oil is Russia. China’s shale gas industry has moved at a faster clip, going from 120 mmcfd in 2014 to 1450 mmcfd in 2019. American companies closed their least productive wells and focused on better performing sites – a strategy known as high-grading. Russia has the biggest shale oil reserves in the world. Each time OPEC has constrained … In my free time, I enjoy skiing, sailing, classical music, and my two cats. 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