U.S. oil and gas production is at an all-time high. No big secret there. We know that records in production are being broken every day. But while the U.S. has been busy fracking away across the nation, production has gone so high that the U.S. has crept up on the world’s largest oil and gas producer, Russia.
In fact, it’s quite possible that the U.S. has already toppled the reigning king and now sits at number one.
Fracking pretty much explains it. The process of blasting large amounts of waters, chemicals, and sand into shale rock to free up gas and oil reserves has helped revive the country’s production levels and revolutionize the entire industry.
Other advances, like horizontal drilling and well stimulation technologies, have become important factors as well, but fracking is by far the most significant.
The oil and natural gas output for the U.S. in July, according to the Wall Street Journal, was 22 million barrels per day, compared with Russia’s forecast of 21.8 million barrels per day.
The U.S. quickly became a force to be reckoned with when it adopted advanced fracking technology, and in the time since, it has become an expert in the matter. In that same time, Russia has lagged behind in embracing the new technology, even though the nation has some of the world’s largest shale formations.
2012 was the first year since 1982 that the U.S. produced more natural gas than Russia.
This doesn’t mean things are slowing down for Russia. Not by a long shot. Things are just happening a little more slowly, as the nation has yet to embrace modern drilling techniques.
Russia can still challenge Saudi Arabia as top crude oil producer of the world. Saudi Arabia produced 11.7 million barrels per day in July, according to the Wall Street Journal, while Russia followed with 10.8 million barrels and the U.S. came in at 10.3 million.
Us vs. Them
Russia and the U.S. are both in a position to elevate production levels in the future. The U.S. may be pulling ahead now, but if Russia decides to employ modern drilling techniques like fracking, it could take back its crown.
Russia has struggled to maintain its output, but it really just comes down to technology. Any day now, the nation could flip the switch and be stronger than ever.
Regardless, the oil and gas game has changed forever. As fracking becomes more popular throughout the world, the entire marketplace is shifting, and traditional petroleum rich countries like Russia don’t hold the clout they once did.
Just look at the U.S. It imports far less gas and oil, according to MarketWatch, as levels have dropped 32 percent and 15 percent, respectively.
Those numbers will only increase. Unconventional gas production in the U.S. is predicted to increase from 42 percent of total gas production in 2007, according to International Business Times, to 64 percent in 2020.
And it all ties back into fracking. Many other countries will likely see the same kind of changes, as modern drilling techniques will account for nearly 70 percent of natural gas development in the future.
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Even if it does ramp up oil and gas production, Russia will still need to start relying on other resources like coal, as it has the second-largest reserves.
As things stand today, the U.S. is on a torrent pace and out-pumping the rest of the world. Even in crude production – where it was once millions of barrels per day behind Russia and Saudi Arabia – the U.S. stands at third place, behind by mere thousands.
Nobody uses new drilling technologies better than the U.S., and it shows.
Other countries are going to eventually catch up. China, Australia, Canada, Argentina, and Russia are all sitting on vast resources of unconventional reserves. These countries could all have booms of their own one day.
How long the U.S. boom lasts will come down to futures prices, regulations, and public support. But right now, it is our time. Today, it’s good to be king.
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