In an article published today in the Wall Street Journal they say that:
"The U.S. is overtaking Russia as the world's largest producer of oil and natural gas, a startling shift that is reshaping markets and eroding the clout of traditional energy-rich nations.
U.S. energy output has been surging in recent years, a comeback fueled by shale-rock formations of oil and natural gas that was unimaginable a decade ago. A Wall Street Journal analysis of global data shows that the U.S. is on track to pass Russia as the world's largest producer of oil and gas combined this year—if it hasn't already.
"The U.S. is overtaking Russia as the world's largest producer of oil and natural gas, a startling shift that is reshaping markets and eroding the clout of traditional energy-rich nations.
U.S. energy output has been surging in recent years, a comeback fueled by shale-rock formations of oil and natural gas that was unimaginable a decade ago. A Wall Street Journal analysis of global data shows that the U.S. is on track to pass Russia as the world's largest producer of oil and gas combined this year—if it hasn't already.
The amount of crude from two of the hottest plays in the U.S.—the Bakken oil field in North Dakota and the Eagle Ford shale formation in South Texas—continues to rise rapidly, while Russian output has increased modestly over the past three years. The Russian government predicts oil output will remain flat through 2016, while natural gas ticks up 3%. The shift has raised concerns in Moscow that U.S. crude supplies will crowd out Russia's oil exports.
"Russia looks like the main loser in the global market," said Tatiana Mitrova, of the Russian Academy of Sciences' Energy Research Institute. More than 40% of Russia's budget comes from oil-and-gas related duties and taxes, she said.
The institute has forecast that Russian oil exports could fall 25% to 30% after 2015, reducing gross domestic product more than $100 billion. Not everyone in Russia sees a threat from the U.S. The head of one the country's largest energy companies, OAO Gazprom,has called expanding U.S. shale output "a bubble that will soon burst."
A similar view was expressed Tuesday by Abdallah Salem el-Badri, the head of the Organization of the Petroleum Exporting Countries, who said in an interview that "the U.S. oil boom from shale will run out of steam by decade's end".
Even optimists in the U.S. concede that the shale boom's longevity could hinge on commodity prices, government regulations and public support, the last of which could be problematic.
Other risk factors: a global economic contraction would depress oil and gas prices, leading companies to slow production. And drilling in shale is expensive and more complex than conventional exploration, leading to concerns that a market downturn could take a large bite out of U.S. output".
