Free Newsletters - Space - Defense - Environment - Energy - Solar - Nuclear
..
. 24/7 Space News .




ENERGY TECH
Mideast oil power wanes as U.S., others boost production
by Staff Writers
Beirut, Lebanon (UPI) Oct 4, 2013


The Middle East is losing its long-held dominance of the global oil market as vast shale oil reserves open up in the United States and elsewhere, and non-Organization of Petroleum Exporting Countries production grows to cushion the market against output cuts in the region.

The U.S. move away from punitive military strikes against the embattled Syrian regime over its alleged use of chemical weapons on rebel forces, and efforts to explore a joint diplomatic effort with Russia have calmed the market despite conflict and political upheaval across the Middle East.

Not so long ago, such turmoil in a strategic energy-producing region would have pushed oil prices through the roof. But the avoidance of U.S. strikes in Syria and the improving prospects of a diplomatic resolution of the troublesome Iranian nuclear crisis have soothed market jitters.

The first nine months of 2013 produced a steady worsening of the Syria crisis -- with spillover into neighboring Jordan, Lebanon, Turkey and Iraq -- while there was no sign of a possible resolution of the confrontation over Iran's contentious nuclear program.

"These factors alone, in years past, would have been sufficient to traumatize global oil markets and force up prices," Oxford Analytica noted this week. "Yet on this occasion the picture was even bleaker, with several Middle East producers facing output difficulties."

Even before the positive developments "the price of crude oil seldom exceeded $110 a barrel -- at a time when production from several Middle East producers has been significantly reduced," it observed.

"The fact that the global market largely shrugged off both the Syria crisis and the region's supply tightness" -- severely restricted Iranian production, with crisis-caused cuts in Iraq, Libya, Yemen, Syria and Sudan -- "reflects the fast growth of non-Middle East and non-OPEC production, particularly from the United States," the report said.

The unprecedented scale of shale oil reserves found across the United States had been the main game-changer. The prospects of further shale oil bonanzas in Europe, Africa and Asia serve to further diminish the Middle East's importance in the energy sector.

Indeed, Saudi Arabia, for decades the world's top oil producer, with spare production capacity and immense economic and political influence, is now being eclipsed by the nation that most depended on a steady supply of affordable Saudi oil and tailored its strategic policies to that dependence.

U.S. shale oil reserves are so vast that just one of its major fields, the Green Valley Formation spanning the western states of Utah, Wyoming and Colorado with 800 billion barrels of recoverable oil, is three times bigger than Saudi Arabia's 267 billion.

However, as analyst Ed Crooks observed in the Financial Times, "North American production costs are significantly higher than in many parts of the Middle East.

"That means the important question for the future of the [United States] as 'the new Saudi Arabia' is what the old Saudi Arabia makes of it.

"OPEC has made it clear it is watching the U.S. oil boom with apprehension, and rightly so; it is the greatest threat to the cartel's power since the fields of Alaska and the North Sea were opened up in the 1970s," Crooks wrote.

"As U.S. production grows, OPEC countries will be forced either to restrict expected growth in their output -- whether by slowing investment in new capacity or holding increased unused capacity -- or accept a much lower oil price."

If sanctions on Iran are rolled back in the event of a diplomatic breakthrough, its production will pick up, and with restored output in Libya, Iraq and Sudan, prices will be pushed down as the region's importance as a global supplier diminishes.

OPEC may seek to reduce production. But with Iraq pushing output to the maximum to bankroll postwar reconstruction, and Iran driving to make up for sanctions-induced losses, "that will put pressure on Saudi Arabia to trim its output, leading to tension among OPEC Middle East members," Oxford Analytica warned.

"The Middle East faces a period of readjustment -- with the former dominance of global oil markets tempered by the emergence of the United States and other non-OPEC states outside the region as major market suppliers," it said. "Unlike in the past, political crises in the Middle East and regional supply tightness no longer trigger a knee-jerk spike in global prices automatically."

.


Related Links
Powering The World in the 21st Century at Energy-Daily.com






Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle




Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News





ENERGY TECH
Spain sees 'limited risk' of big quake linked to gas
Madrid (AFP) Oct 04, 2013
Spain's government said Friday there is a limited risk of a big earthquake shaking the eastern coast after a string of small tremors linked to a vast offshore gas storage plant. In the past month, some 400 earthquakes have rattled the Gulf of Valencia, where a depleted oil reservoir is being used as a giant gas storage facility. The activity has frightened residents but so far caused no dama ... read more


ENERGY TECH
China unveils its first and unnamed moon rover

Mission to moon will boost research and awareness

Mighty Eagle Improves Autonomous Landing Software With Successful Flight

Watch Out for the Harvest Moon

ENERGY TECH
NASA Mars mission escapes government shutdown, will launch

European rover meant for Mars to undergo earthly desert test

First ARCA flight in the ExoMars Program completed successfully

A Seasonal Ozone Layer Over The Martian South Pole

ENERGY TECH
Non-Orbiting Space Junk

Paper written as science hoax published by 157 science journals

Tokyo gadget show offers glimpse of tomorrow

Astronauts Practice Launching in NASA's New Orion Spacecraft

ENERGY TECH
Onward and upward as China marks 10 years of manned spaceflight

Chinese VP stresses peaceful use of space

China's space station to open for foreign peers

Last Days for Tiangong

ENERGY TECH
Aerojet Rocketdyne Thrusters Help Cygnus Spacecraft Berth at the International Space Station

First CASIS Funded Payloads Berthed to the ISS

Unmanned cargo ship docks with orbiting Space Station

New space crew joins ISS on Olympic torch mission

ENERGY TECH
Milky Way-mapping Gaia receives its sunshield

Arianespace's next Ariane 5 mission will serve two key customers: SES and HISPASAT

After Successful Spacecraft Docking, US Orbits Five Satellites

US private spacecraft company SpaceX launches upgraded Falcon rocket

ENERGY TECH
Kepler Finds First Signs of Other Earths

Nearby binary star system gets officially confirmed third member

Astronomers create first cloud map of distant planet

How Engineers Revamped Spitzer to Probe Exoplanets

ENERGY TECH
Lockheed Martin and Concord Blue to Deploy Advanced Gasification Technology Globally

Lockheed Martin Powers on First GOES-R Weather Satellite

How to make ceramics that bend without breaking

AREVA awarded funding for innovative manufacturing technology




The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement