7 ms·

>ISTANBUL (Reuters) - Total oil production in the United States will be nearly equal to that of Russia and Saudi Arabia combined by 2025, the head of the Intern

>ISTANBUL (Reuters) - Total oil production in the United States will be nearly equal to that of Russia and Saudi Arabia combined by 2025, the head of the International Energy Agency (IEA) said on Friday. Fatih Birol made the comment in an interview with Turkey’s state-owned Anadolu news agency. Shortest article ever? In all seriousness I don’t think this is the worst thing for any of the three countries. Most new US production is higher cost (fracking), so the drop in market share is at least met with a stronger price floor for all.

smnrchrds 8y ago
> Shortest article ever? It's Reuters. They are a wire service. They report news, not write articles.
- AimForTheBushes 8y ago
  Which is why they are, imo, the best large news corporation.
devy 8y ago
> In all seriousness I don’t think this is the worst thing for any of the three countries. I don't think you are being serious. The fact that humans are still exploiting fossil fuels in an accelerated pace is the worst thing could have happen to the earth's climate change.
- josephjrobison 8y ago
  I agree with you that we should be moving to renewables as fast as possible. At the same time, there's a lot of upside to reducing the power of authoritarian oil states that gives dictatorships power to squash democracy and human rights. "Study after study has found that, while discovering big oil deposits doesn't turn democratic countries with a lot of oil like Norway and Canada authoritarian, authoritarian countries are more likely to stay that way if they've got a ton of oil. Of all the bad things that oil does for countries, this is probably the worst and most robustly demonstrated." https://www.vox.com/2014/4/10/5601062/oil-curse-explained https://www.vox.com/2014/4/10/5601062/oil-curse-explained Say what you will about the U.S. (and Canada and Norway), but I'd rather a democracy be the biggest producer than an autocracy.
  - vtange 8y ago
    Not to mention it sorta insulates us from the political shenanigans of that region. Especially true if you believe Iraq was "all about the oil."
    - adventured 8y ago
      The recent flexing by Congress of their War Powers Act authority [1][2] in regards to Yemen / Saudi Arabia - which was unprecedented in recent US history - may have only occurred due to the boom in US oil production. I'd expect that most of Congress would have been a lot more concerned with upsetting the relationship with Saudi Arabia otherwise. [1] https://www.npr.org/2018/12/11/675343616/often-quiet-on-wars-congress-challenges-white-house-over-yemen https://www.npr.org/2018/12/11/675343616/often-quiet-on-wars... [2] https://foreignpolicy.com/2018/11/28/senate-advances-resolution-to-end-u-s-support-for-saudi-led-war-in-yemen/ https://foreignpolicy.com/2018/11/28/senate-advances-resolut...
  - devy 8y ago
    In grand scheme of things, these don't matter when the sea level raises 2 meters and 2/3 of coastal population and civilization got wiped out post-2040.
    - phyller 8y ago
      In the grand scheme of things, if that's accurate they've got 20+ years to find 2 meters of elevation so they don't get drowned. This kind of breathless reaction is what makes people skeptical of the entire concept. Please explain to me how this means the end of civilization.
      - jessaustin 8y ago
        It will be a lot more clear to both of us when we're paying the taxes to "bail out" the real estate developers who are investing in Miami right now.
      - devy 8y ago
- war1025 8y ago
  If you believe in the merits of newer, more efficient technology, then having an abundant supply of oil doesn't really come with a downside, IMO. It's much easier to let the new technology speak for itself than to tell people, "Hey, we know what we're offering is no good, but it's what we've got to do." Cheap oil will make green energy a smart business choice rather than a sacrifice. The optics on that are way better.
  - aljones 8y ago
    No downside? The externalities of oil production and consumption are well known.
    - war1025 8y ago
      Abundant supply of oil is different from increased demand for oil. Someday we will hit "peak oil", and it will be much better for everyone if that mean "peak oil demand" than "peak oil supply".
      - aljones 8y ago
        Supply and demand are related.
  - vec 8y ago
    That's exactly backwards. Cheaper oil will lower the operating costs of power plants that use oil as a fuel, which raises the bar that newer technologies will have to clear to be comparatively more efficient, which will in turn slows the rate of adoption for renewables. CO2 emissions are cumulative, and there's far more CO2 still sequestered in as-yet-unburned fossil fuels than even the rosiest estimates say our atmosphere could safely absorb. That implies that we're going to have to leave some sizable fraction of our planet's remaining oil in the ground, permanently. From a long term betterment of the species standpoint, what we really want to be seeing is the global supply of oil starting to taper off and costs per barrel drifting slowly but steadily upward.
    - 8y ago
pavpanchekha 8y ago
The cost of US fracking continues to drop; $40 oil is plausible in the near future. The issue for Russia and the KSA is that their budgets aren't solvent at a $40 or $50 oil price
- notfromhere 8y ago
  its what happens when your state is basically a poorly-run oil company
- protomyth 8y ago
  The article discussed here https://news.ycombinator.com/item?id=18505672 https://news.ycombinator.com/item?id=18505672 mention lower that $40 happens in Texas.
- Arnt 8y ago
  What's the KSA? Saudia Arabia? Doesn't Ghawar produce at around a lowish single-digit cost? https://en.wikipedia.org/wiki/Ghawar_Field https://en.wikipedia.org/wiki/Ghawar_Field
  - hokkos 8y ago
    He talks about SA budget, they sure earn money, but not enough to subsidize their citizen like they used to.
  - kevinstubbs 8y ago
    KSA = Kingdom of Saudi Arabia
adventured 8y ago
> Most new US production is higher cost (fracking), so the drop in market share is at least met with a stronger price floor for all. The price floor problem for Russia and Saudi is societal and governmental financial, rather than raw production cost based. Saudi Arabia now needs ~$95 oil to balance its budget for 2019. That has persistently been moving higher for them. So they're stuck in a death trap on price, where they're one of the few producers that can cut substantially to lift prices which the US producers constantly push down on. So they lose share to the US producers just to try to stay alive on price. Meanwhile it costs ever more money to placate the people of Saudi Arabia (and their population is growing rapidly, tripling since ~1982; a problem Russia of course doesn't have, with a stable population figure). Eventually that formula explodes, something will give in the coming decade. Russia is in better shape on the price they need. They're a lot more comfortable near $60 than the Saudis. However they're still not able to realistically sustain oil prices lower than what the $40-$50 Permian producers can manage (seeing as the US producers don't have a national budget to support or a social bribe to pay for stability).
user2426679 8y ago
> Most new US production is higher cost (fracking), so the drop in market share is at least met with a stronger price floor for all. Not to be rude, but this is really off the mark. The only reason that we're not still in a cartel market regime of $100 barrels is fracking being invented/discovered and efficiently improved. It cut the price floor well in half. Fracking is not the cheapest, but it's also not the most expensive (see Canada's oil sands). When you compare fracked WTI (basically the USA-sourced index) to offshore Brent (North Sea, off the coast of UK), the costs are apples to oranges because fracking can be readily tapped at a relative drop of the hat (if prices spike in a short term period), but offshore is a huge multi-million/billion endeavor where you have to depreciate costs over a really long time horizon (same with oil sands, but different tech).

smnrchrds 8y ago

> Shortest article ever? It's Reuters. They are a wire service. They report news, not write articles.

AimForTheBushes 8y ago
Which is why they are, imo, the best large news corporation.

devy 8y ago

> In all seriousness I don’t think this is the worst thing for any of the three countries. I don't think you are being serious. The fact that humans are still exploiting fossil fuels in an accelerated pace is the worst thing could have happen to the earth's climate change.

josephjrobison 8y ago
I agree with you that we should be moving to renewables as fast as possible. At the same time, there's a lot of upside to reducing the power of authoritarian oil states that gives dictatorships power to squash democracy and human rights. "Study after study has found that, while discovering big oil deposits doesn't turn democratic countries with a lot of oil like Norway and Canada authoritarian, authoritarian countries are more likely to stay that way if they've got a ton of oil. Of all the bad things that oil does for countries, this is probably the worst and most robustly demonstrated." https://www.vox.com/2014/4/10/5601062/oil-curse-explained https://www.vox.com/2014/4/10/5601062/oil-curse-explained Say what you will about the U.S. (and Canada and Norway), but I'd rather a democracy be the biggest producer than an autocracy.
- vtange 8y ago
  Not to mention it sorta insulates us from the political shenanigans of that region. Especially true if you believe Iraq was "all about the oil."
  - adventured 8y ago
    The recent flexing by Congress of their War Powers Act authority [1][2] in regards to Yemen / Saudi Arabia - which was unprecedented in recent US history - may have only occurred due to the boom in US oil production. I'd expect that most of Congress would have been a lot more concerned with upsetting the relationship with Saudi Arabia otherwise. [1] https://www.npr.org/2018/12/11/675343616/often-quiet-on-wars-congress-challenges-white-house-over-yemen https://www.npr.org/2018/12/11/675343616/often-quiet-on-wars... [2] https://foreignpolicy.com/2018/11/28/senate-advances-resolution-to-end-u-s-support-for-saudi-led-war-in-yemen/ https://foreignpolicy.com/2018/11/28/senate-advances-resolut...
- devy 8y ago
  In grand scheme of things, these don't matter when the sea level raises 2 meters and 2/3 of coastal population and civilization got wiped out post-2040.
  - phyller 8y ago
    In the grand scheme of things, if that's accurate they've got 20+ years to find 2 meters of elevation so they don't get drowned. This kind of breathless reaction is what makes people skeptical of the entire concept. Please explain to me how this means the end of civilization.
    - jessaustin 8y ago
      It will be a lot more clear to both of us when we're paying the taxes to "bail out" the real estate developers who are investing in Miami right now.
    - devy 8y ago
war1025 8y ago
If you believe in the merits of newer, more efficient technology, then having an abundant supply of oil doesn't really come with a downside, IMO. It's much easier to let the new technology speak for itself than to tell people, "Hey, we know what we're offering is no good, but it's what we've got to do." Cheap oil will make green energy a smart business choice rather than a sacrifice. The optics on that are way better.
- aljones 8y ago
  No downside? The externalities of oil production and consumption are well known.
  - war1025 8y ago
    Abundant supply of oil is different from increased demand for oil. Someday we will hit "peak oil", and it will be much better for everyone if that mean "peak oil demand" than "peak oil supply".
    - aljones 8y ago
      Supply and demand are related.
- vec 8y ago
  That's exactly backwards. Cheaper oil will lower the operating costs of power plants that use oil as a fuel, which raises the bar that newer technologies will have to clear to be comparatively more efficient, which will in turn slows the rate of adoption for renewables. CO2 emissions are cumulative, and there's far more CO2 still sequestered in as-yet-unburned fossil fuels than even the rosiest estimates say our atmosphere could safely absorb. That implies that we're going to have to leave some sizable fraction of our planet's remaining oil in the ground, permanently. From a long term betterment of the species standpoint, what we really want to be seeing is the global supply of oil starting to taper off and costs per barrel drifting slowly but steadily upward.
  - 8y ago

pavpanchekha 8y ago

The cost of US fracking continues to drop; $40 oil is plausible in the near future. The issue for Russia and the KSA is that their budgets aren't solvent at a $40 or $50 oil price

notfromhere 8y ago
its what happens when your state is basically a poorly-run oil company
protomyth 8y ago
The article discussed here https://news.ycombinator.com/item?id=18505672 https://news.ycombinator.com/item?id=18505672 mention lower that $40 happens in Texas.
Arnt 8y ago
What's the KSA? Saudia Arabia? Doesn't Ghawar produce at around a lowish single-digit cost? https://en.wikipedia.org/wiki/Ghawar_Field https://en.wikipedia.org/wiki/Ghawar_Field
- hokkos 8y ago
  He talks about SA budget, they sure earn money, but not enough to subsidize their citizen like they used to.
- kevinstubbs 8y ago
  KSA = Kingdom of Saudi Arabia

adventured 8y ago

> Most new US production is higher cost (fracking), so the drop in market share is at least met with a stronger price floor for all. The price floor problem for Russia and Saudi is societal and governmental financial, rather than raw production cost based. Saudi Arabia now needs ~$95 oil to balance its budget for 2019. That has persistently been moving higher for them. So they're stuck in a death trap on price, where they're one of the few producers that can cut substantially to lift prices which the US producers constantly push down on. So they lose share to the US producers just to try to stay alive on price. Meanwhile it costs ever more money to placate the people of Saudi Arabia (and their population is growing rapidly, tripling since ~1982; a problem Russia of course doesn't have, with a stable population figure). Eventually that formula explodes, something will give in the coming decade. Russia is in better shape on the price they need. They're a lot more comfortable near $60 than the Saudis. However they're still not able to realistically sustain oil prices lower than what the $40-$50 Permian producers can manage (seeing as the US producers don't have a national budget to support or a social bribe to pay for stability).

user2426679 8y ago

> Most new US production is higher cost (fracking), so the drop in market share is at least met with a stronger price floor for all. Not to be rude, but this is really off the mark. The only reason that we're not still in a cartel market regime of $100 barrels is fracking being invented/discovered and efficiently improved. It cut the price floor well in half. Fracking is not the cheapest, but it's also not the most expensive (see Canada's oil sands). When you compare fracked WTI (basically the USA-sourced index) to offshore Brent (North Sea, off the coast of UK), the costs are apples to oranges because fracking can be readily tapped at a relative drop of the hat (if prices spike in a short term period), but offshore is a huge multi-million/billion endeavor where you have to depreciate costs over a really long time horizon (same with oil sands, but different tech).