Americas News
OPEC & Shale Producers to Meet Amid Predictions that US Will be Top Oil Producers by 2019
Yet more evidence of a fundamental power shift between global oil producers was revealed Tuesday by industry sources, who told Reuters that the Organization of the Petroleum Exporting Countries (OPEC) will attend a dinner next Monday at Houston's CERAWeek energy conference with U.S. shale firms, presumably to talk about ways to maintain a proper balance between crude supply and demand.
This comes one year after the cartel undertook unprecedented talks with fund executives and shale producers on the sidelines of CERAWeek, which next week will see Mohammad Barkindo, secretary general for OPEC along with other OPEC officials hunker down with shale companies of various sizes.
A shale chief executive who requested anonymity said, "Shale has dramatically changed the world's perception of fossil fuels; we now have a seat at the table on pricing."
While it could be argued that fear of new-found American producing might is the motivating force behind the meeting, Ali Nazar, Iraq's national representative to OPEC, preferred to remark that "It's normal for shale oil, tight oil to increase in 2018 and whenever oil prices support it, but we all should look with responsibility to the market in order to keep the balance in the market as much as we can so as not to harm investors."
Nonetheless, a re-energized American oil industry strongly supported by a Donald Trump presidency shows no signs of anything but mounting global dominance: in fact, Fatih Birol, executive director of the International Energy Agency, said on Tuesday that the U.S. would overtake Russia as the biggest crude oil producer "definitely next year", if not this year.
Speaking at an event in Tokyo, Birol added, "U.S. shale growth is very strong, the pace is very strong ... the United States will become the number one oil producer sometime very soon," adding that "Canada, especially the oil sands, and Brazilian offshore projects...are the two major [non-U.S.] drivers."
Birol recently stated that while "a significant amount of non-OPEC oil [is] coming to the markets," he believes that after 2020 the market could destabilize due to high demand, maturing fields, and under-investment in new supply.
