Our frackers beat their hackers

Four facts illuminate the realities of where Russia’s preferences reside. All of the salient information emerges from petroleum domains.

First, the price of oil matters to Russia. Half of Russia’s gross domestic product and more than 70 percent of its export revenues come from selling oil and natural gas. That money not only powers the Russian economy, it is key to that nation’s ability to finance expensive foreign adventurism from the Middle East to Ukraine. Today’s low prices are depriving Russia of more than $150 billion every year; even in Washington, that’s real money. But in equivalent terms, that would be like wiping $1.5 trillion from the U.S. economy.

Second, America’s private-sector shale industry was the direct and indisputable trigger for the global petroleum price collapse. Thousands of small and mid-sized companies — it was not “big oil” that created the shale revolution — added more oil (and natural gas) to global markets in a shorter period than at any time in the past half century, anywhere. American frackers came out of nowhere — i.e., they emerged out of private-sector innovation on private land, not from government subsidies and preferences — to go from near-zero revenues to $150 billion per year in sales in just a half dozen years or so. To put that in perspective, the global smartphone industry, which emerged around the same time, went from zero to $70 billion per year of sales over the same period.