Boom: United States wresting the title of top energy producer from Russia

posted at 3:21 pm on October 3, 2013 by Erika Johnsen

While the Obama administration continues to disappoint with their lack of know-how in unburdening our stagnant economy and, painfully recently, in their foreign-policy snafu with Russia, let us instead turn out attention to the private sector which — unsurprisingly — is just doing it better, on both fronts.

According to the WSJ, the United States is well on its way to overtaking Russia as the world’s largest producer of oil and gas combined — which has some serious and likely unwelcome implications for the longstanding clout of other traditionally energy-rich countries, hem hem:

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. produced the equivalent of about 22 million barrels a day of oil, natural gas and related fuels in July, according to figures from the EIA and the International Energy Agency. Neither agency has data for Russia’s gas output this year, but Moscow’s forecast for 2013 oil-and-gas production works out to about 21.8 million barrels a day.

U.S. imports of natural gas and crude oil have fallen 32% and 15%, respectively, in the past five years, narrowing the U.S. trade deficit. And since the U.S. is such a big consumer of energy, the shift to producing more of its own oil and gas has left substantial fuel supplies available for other buyers. Nations that rely on peddling petroleum for their economic strength and political clout face dwindling market power as a result. Oil prices so far remain high, however, closing Wednesday at $104.10 a barrel, up 18% from a year ago.

Whenever companies and countries freely compete in an open global market, consumers the world over win — but that is a bit of an inconvenience for the powers that be in Moscow, because it’s going to take a significant bite out of the regional energy dominance on which they largely rely for their geopolitical power and economic growth. Although Russia is believed to have one of the planet’s largest untapped oil-bearing shale formations, they have yet to pick up on the hydraulic fracturing technologies that have been the bedrock of America’s shale boom; the balance could eventually swing back the other way (or somewhere entirely different) as more and more countries are looking at taking up the practice, but for the time being, the U.S. is giving Russia and Saudi Arabia some stiff and healthy competition.


Related Posts:

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

Hah, soon the left will accuse Erika of using “Boom” at a time when the Capitol was shot at.

Schadenfreude on October 3, 2013 at 3:23 PM

But I thought Obama was killing domestic energy production?

red_herring on October 3, 2013 at 3:24 PM

Took two comments to bring teh stoopid from the left…

Murphy9 on October 3, 2013 at 3:27 PM

But I thought Obama was killing domestic energy production?

red_herring on October 3, 2013 at 3:24 PM

He is, on federal lands where he can.

slickwillie2001 on October 3, 2013 at 3:31 PM

But but, I thought Obama had given all our oil industry to Brazil, sabotaged companies here, and made a concerted effort to deny all drilling permits so he could help bring about the intentional destruction of America!

Or… Something…

;)

Genuine on October 3, 2013 at 3:32 PM

Obama actually took credit for this today. LOL – it all happened in spite of him!

HondaV65 on October 3, 2013 at 3:38 PM

Obama hardest hit. It’s hard to be green!
Don’t worry, he’s straterygizing right now…

Marcola on October 3, 2013 at 3:39 PM

But I thought Obama was killing domestic energy production?

red_herring on October 3, 2013 at 3:24 PM

The more he tightened his grip, the more energy slipped through his fingers…..

itsspideyman on October 3, 2013 at 3:40 PM

But but, I thought Obama had given all our oil industry to Brazil, sabotaged companies here, and made a concerted effort to deny all drilling permits so he could help bring about the intentional destruction of America!

Or… Something…

;)

Genuine on October 3, 2013 at 3:32 PM

American inguinity found a way. Horizontal drilling means they can drill from miles away parallel to the ground. Which means the money the government could have gotten by renting lands is going into the hands of private land owners.

itsspideyman on October 3, 2013 at 3:42 PM

American inguinity found a way. Horizontal drilling means they can drill from miles away parallel to the ground. Which means the money the government could have gotten by renting lands is going into the hands of private land owners.

itsspideyman on October 3, 2013 at 3:42 PM

Win-Win.

Murphy9 on October 3, 2013 at 3:44 PM

United States wresting the title of top energy producer from Russia

When Obama hears about this heads will roll in the Energy Dept. He vowed to bankrupt coal energy producers – things just don’t seem to be going according to his plan.

whatcat on October 3, 2013 at 3:46 PM

It is just so racist of the US to do this.
/end sarc for those of you who need one.

sleepyhead on October 3, 2013 at 3:46 PM

But I thought Obama was killing domestic energy production?

red_herring on October 3, 2013 at 3:24 PM

Imagine if he didn’t throw roadblocks in the way. Like slow-rolling the Keystone-XL pipeline.

This is happening DESPITE the government.

Jeff Weimer on October 3, 2013 at 3:48 PM

Hey….remember Peak Oil? Those guys who made prediction after prediction that the worlds economy was going to collapse because all of the cheap and easy oil was gone and everyone would die? Yeah those guys. They went the way of other ridiculous predictions of doom like Acid Rain, Y2K, Killer Bees, Nuclear Winter, the coming Ice Age, etc.

Losers all of them.

Johnnyreb on October 3, 2013 at 3:49 PM

Even Jimmy Carter could have had a booming economy if he had had an energy boom like this. So why do we have this crappy economy? Because Obama.

Squiggy on October 3, 2013 at 3:49 PM

Boom: United States wresting the title of top energy producer from Russia

Will it make any difference?

Dr. ZhivBlago on October 3, 2013 at 3:51 PM

Have to applaud Erika for writing such an illuminating post about a topic she might know something about.

Well done!

DarkCurrent on October 3, 2013 at 3:52 PM

President Obama is the anti-Midas.

Hates fracking and shale oil. Result: energy boom.
Loves green energy and highspeed rail. Result: billions wasted on nothing.

Seriously, if you ever want to laugh and have the hair stand up on your neck at the same time, go read all those 2009 articles about how President Obama wanted to emulate Spain’s “green economy.” Spain now has 25% unemployment.

JeremiahJohnson on October 3, 2013 at 3:53 PM

But I thought Obama was killing domestic energy production?

red_herring on October 3, 2013 at 3:24 PM

No. He’s killing the economy. He just tried to kill energy production.

But as long as gasoline is expensive he’ll be happy enough.

Squiggy on October 3, 2013 at 3:56 PM

But I thought Obama was killing domestic energy production?

red_herring on October 3, 2013 at 3:24 PM

Here’s a Reuters story from July 22 on the drilling rules on U.S. Bureau of Land Management leases. Basically what it comes down to is if you’re drilling in the Permian Basin/Delaware Basin formations, if you drill on the New Mexico side of the line, under BLM authority, it may cost you up to $100,000 more per well to conform to the proposed federal standard than if you drill the same well on the Texas side of the state line.

That’s why back in 2006, when Bush was president, the number of wells operating in New Mexico was around 75, and now under Obama — and after the major oil fracking boom — the number of rigs operating in New Mexico is around 75. Meanwhile, the totals in the counties across the state line in Texas have tripled during that same period (and I can post the links to that, too, from the Baker-Huges website, but they’re in xml or pdf format).

jon1979 on October 3, 2013 at 4:01 PM

And just imagine how much energy we could produce if the government would get out of the way.

Chris of Rights on October 3, 2013 at 4:18 PM

King Barry still says STAY OFF MY LAWN!

GarandFan on October 3, 2013 at 4:39 PM

Under King Barky the Economy Slayer’s first term there was a record low number of federal leases available. Those that were available had no oil.

jukin3 on October 3, 2013 at 4:49 PM

Then why are gas prices still so unbelievably high?

John the Libertarian on October 3, 2013 at 5:20 PM

And all of this is despite of the anti-business and anti-fossil fuel policies of the Obama Administration.

If, on the other hand the Administration had not embraced their anti-business and anti-fossil fuel policies, not only would we have already passed Russia in energy production, we would be enjoying a robust and real economic recovery.

Here in the People’s Republic of Mexifornia, we’re enjoying a brief respite in gasoline prices – the local station is only $3.90 per gallon, down from $4.10 10 days ago. Price should start up again soon – mid-November we need to switch from the summer grade of fuel.

Athos on October 3, 2013 at 5:41 PM

Then why are gas prices still so unbelievably high?

John the Libertarian on October 3, 2013 at 5:20 PM

refinery issues maybe?
not correct type of crude maybe?

dmacleo on October 3, 2013 at 8:02 PM

I hear via the grape vine that the manufacturing jobs might slowly be coming back to the US simply because its getting more expensive to do such things in countries like china, along with shipping cost… just makes more sense to have the jobs here.

With that said, I also was told that there was a company that was looking to open a plant to make clothing but the problem is, those type of jobs long ago left, so there is literally NO ONE that has the skills to do such work, so they have to train people on how to do this.

What would open the flood gates is we actually made energy cheaper here in the states. This country is HUNGRY for growth like this. Not only that, but it would bring back some what decent paying JOBS back.

watertown on October 3, 2013 at 8:05 PM

John the Libertarian on October 3, 2013 at 5:20 PM

A lot of the problems for that is the fact there has not been a refinery built for many many many years.

There is only 16 or so refineries here in the US and the last one was built in 2008… and its small…

watertown on October 3, 2013 at 8:07 PM

Also like to add there is one being built that should be online here shotly… started in march in all places…North Dakota. Its gonna be a massive 20K BPD … where as the last 2 that were built are around 4k BPD

watertown on October 3, 2013 at 8:09 PM

watertown on October 3, 2013 at 8:05 PM

Walmart is beginning to buy USA to avoid the shipping costs from China. With regard to manufacturing, I don’t know a single mold maker, or tool and die maker under the age of 50. Most have retired. There jobs disappeared. Since Quasar went under no American company has made a television set and I’d be surprised if anyone could. I’m one of the last high volume product engineers on the coast and Stanley Black and Decker outsourced my job to India.

There’s no one for me to teach the skills to, because you can’t get a job doing it in the US. The few people I know with similar skill sets who are still working are as old as I am.

We learned by working with the craftsmen (model makers, machinists, mold makers etc) who’s jobs have been off shored. Anew generation will not have this available to them.

danielreyes on October 3, 2013 at 8:29 PM

Then why are gas prices still so unbelievably high?

John the Libertarian on October 3, 2013 at 5:20 PM

The conundrum with fracking is that while it opens up new areas to exploration, they’re not economically viable to drill at the old oil prices. Case in point — The area to the south of where I am in West Texas had zero active rigs until 5-6 years ago, and now has a glut of them. But the area’s only viable using current technology as long as the price of oil stays above $80 a barrel.

When the price plunged from $147 to $38 a barrel from mid-2008 to early ’09, all the drilling went away, because it cost more to drill the shale than you could expect to get from any oil pumped out of the ground. Once the price went back above $80, the rigs returned.

As the technology gets better, the extraction price is likely to come down and/or areas that can’t be successfully fracked right now for under $120 a barrel may be tapped. The former would lead to more oil and lower prices; the latter would get more oil, but at $120 bbl, the prices would be heading in the other direction.

jon1979 on October 3, 2013 at 10:10 PM

Just imagine how much more production would be if Obama’s EPA, energy dept, and WH were out of the way.

Btw- “Tea Partiers” call their congressmen and suddenly they are “activists, lobbiest, etc” and, even though the Tea Party is supposedly “dead” or “irrelevant”, it has all the power and influence in the world. Yet, there is not a peep or complaint about the lobbying, politicall grasp and influence that “green” activists have on the local and federal Goverment, much less the boatload of money they spend to make sure we don’t produce more energy.

ptcamn on October 4, 2013 at 12:59 PM