Skip to comments.US Oil Production in Largest Ever Single-Year Increase (Oil Find That Holds More Than All of OPEC)
Posted on 06/13/2013 3:35:20 AM PDT by lbryce
A report has revealed that 2012 saw the largest single-year increase in US oil production ever recorded.
US production grew due to an increase in techniques such as fracking, a method for extracting shale oil and gas, the report by oil giant BP said.
Overall, global energy consumption grew by 1.8% in 2012, a smaller increase than in 2011. China and India accounted for almost 90% of that growth.
(Excerpt) Read more at bbc.co.uk ...
So, frankly, I am rather confused. With bad economic news, worse economic news supposedly going to get even worse, we are in midst of the greatest oil production boom in history, an oil find that holds more than all of OPEC. I understand the dynamics of the production of US shale oil and gas is different, more difficult to get at than the oil seeping out of the ground in the Middle East. Issues in getting at the oil including ecological considerations make comparison between the US shale oil production and that of the Middle East somewhat unequal but still nevertheless, the US record in oil production is impressive.
So, my question is, eliminating the terrible political mess, moral, ethical issues that dog the president, how does it all fit into an economy that is supposedly DOA, and how does it impact the future for the US, its economy, its stature as the sole global super power?
it means obama won’t be able to collapse the economy....
I’ll say it to you as I say it to others daily and those back home in the Northeast, my area in Texas is growing by leaps and bounds. If the USA GDP is flatlined, then there must still be areas in massive decline.
Without the increase in oil production, supply and demand rules applied to the current cost oil (currently pushing $100/barrel due to the declining US dollar), would cause the price of oil to skyrocket, which would dampen economic growth. With the increase in oil production, economic growth could not only be sustainable, but could be driven by it.
Meanwhile back at the pumps, gas is stuck over $3 a gallon. Double what it as just a couple years ago.
There is an energy input into every single product and service we consume. Some are direct, like the gas you need to drive your car to work. Some are indirect, like the energy needed to feed the internet.
A modern society cannot survive without energy. The more advanced the society, the more energy that is needed. The more abundant the energy, in all its forms, the cheaper it becomes. Cheaper energy inputs into all goods and services mean lower prices for those goods and services. Lower prices mean a higher standard of living because people can afford more goods and services.
On the macro side, producing more energy domestically means more jobs and more prosperity. It also means importing less or no expensive energy and, perhaps, even exporting energy. Another boost for national wealth.
Economically, there is only an upside.
this is good news -
but how is it affecting our homeland? The increase hasn’t had an affect on prices at the pump, and all the other costs affected by oil?
And how come gas is $4.21 per gal. in Milwaukee this week?
Look at it this way.
The economy is very weak. It has been this way for years. Obama’s policies take a wrecking ball to it.
The oil and gas shale activity is helping to keep it from being even worse. But all by itself is not enough to make the economy strong in the face of Obama’s policies.
Those areas of the country that are availing themselves of this activity are doing far better than those that aren’t, creating an unevenness of effect on various locations.
I can’t say for Milwaukee.
How come gas is 3.29 in my part of West Texas? That’s too high, but lower than in a lot of places.
Another way to look at it is, those idiots that were salivating at the thought that gas was headed to, first 5, then 10 $$$ a gallon have been kicked in the teeth.
A number of factors go into the price of gas at the pump. It’s worthwhile to list them, but I’m not in the mood for getting down into those weeds.
Supply and demand is only one of them, given all the other things that are affecting prices, too.
What would prices at the pump be if not for this new activity? If Obama had his way, they would be towards $5 and heading for $10. That is the dream of the idiots on the Left. Small comfort, maybe. But supply and demand is only one factor affecting the price, so that one factor cannot by itself lower the price where we want it to be. But there is no doubt whatsoever that without this greatly increased activity the price situation would be worse than it is.
Actually, I can repeat their excuse for the high price — rumor.
There was a rumoor that a distributor would not be able to meet its delivery schedule last week and that caused the price to jump from $3.89 where it had been stuck for weeks to $4.09 (and as high as $4.21) over night.
Hooray! We have all the $90-$250/brl oil we can use! We’re saved! I’m glad we don’t have to worry about the economic impact of that or factor out anything inconvenient like EROEI. Glad to see that the oil companies and refiners can comfortably milk me for $4/gallon when there is so much oil production they are having a hard time finding places to store it.
‘McGreevey’(former NJ Governor). Very nicely done. :-)
Our price here has been stuck at 3.29 for weeks.
But you just stated it yourself - at least one factor that could account for the price there. There was a rumor about a distribution problem. There you go. That’s just one of several factors that can contribute to it.
The way our economy is being strangled, it’s to the point that the only way to look at this shale production boom now is as an underpinning to overall economic activity, helping to hold that activity level above the point of collapse.
Suppose that you took Texas and North Dakota out of the economic stats. Imagine what the numbers would look like, then. That’s another way of looking at our economy. It’s weak, it’s uneven, it’s on shaky not firm ground. This activity is a backstop keeping the ball on the playing field and that’s about it.
While it has the potential to literally shoot our economy to the moon, if the downward drag factors could be eased or removed.
Ours just went up 20 cents a gallon the other day..Florida.
Don't expect it to drop. High oil prices justify the expense of getting at all this new oil. If the price drops too far then it becomes uneconomical to extract.
The product also goes on the world market.
But this production is just about all there is preventing the Leftist idiots dream of $10/gal pump prices right here in America.
Price at the pump isn’t even what this thread was started in order to discuss. The question was how is this economic activity affecting the American economy. You do realize that is asking about GDP and jobs and decreased dependency on foreign oil, more than it is pump price, although nobody is dismissing pump price.
But the way to look at all of those things is to realize everything, and I mean everything, would be far worse than it is without this gangbusters shale activity.
It might be small comfort, but you would know the ill effects if this activity didn’t exist, which is what Obama and all Leftist minions WANT.
Yeah, silly me, bringing up pesky things like a glut of above ground supply not finding it’s way into lower prices of crude or refined product. Sorry for not staying within the intended purpose of the post.
Gas will never be $2.00 per gallon again, and you don’t want it to be.
Yes, we have the wonderful technology that has made accessible oil and gas reserves that were previously thought to be not recoverable. But it comes at a cost. It costs $70 per barrel just to get the oil out of the ground in a shale fracking operation. That means that with transportation and other costs, we need oil to be at $80-90 per barrel just to make it economically profitable to drill for it here.
If the price drops below that amount, the wells shut down, we lose jobs and all this good economic news is history.
As long as the price is stable around $3.50 per gallon, we can enjoy the energy boom, the economy will adjust and life will be good. In fact, it’s been stable around this price range for about five years now, and that’s why we are having the domestic energy increase.
Obama and B. Clinton are both either fortunate or were blessed for some reason. Clinton had the Internet/Technology revolution that created massive spending by individuals and companies and Y2K that caused massive spending by companies.
Obama has the oil.
Neither did a damn thing to create either, but those things saved the economies while they floundered and wasted tax dollars and set up massive regulatory beasts. Poor old Jimmy just didn’t get lucky with an energy or technology revolution.
It would be pretty grim.
if they have filled the storage tanks and pipelines it seems the prices should drop dramatically.
I hope they are not shipping so much overseas that the effect here is but minimal.