Shane Thielges | Shale Plays Media
World oil prices would be hovering around $150 a barrel right now if it weren’t for the U.S. shale boom, Quartz reports.
Despite ongoing tensions in oil-producing countries like Russia, Iraq and Libya, the price of a barrel of oil was about $96 this morning. That’s about $50 less than the world would’ve been forced to pay if the United States did not produce oil from its shale plays, former BP CEO Tony Hayward says.
Global oil consumption is about 92 million barrels a day. The U.S. produces 8.5 million per day, 3 of which are from shale wells drilled within the past few years. If that supply – and an additional million barrels a day from Canadian wells drilled in the same time period – were not available, the world’s supply would fall short, driving prices up in a frenzied competition.
Worldwide, the lower price saves companies $5 billion every day.
A series of unusual market disruptions started in 2011 when the Arab Spring protests interrupted oil production in several Middle Eastern countries. Ensuing instances of violence and political upheaval have periodically disrupted production since that time. Hayward’s figure assumes a world in which the hydraulic fracturing boom never existed to offset these losses.
The estimated $150 price tag agrees with a similar study conducted last May by IHS Energy.
Read the Quartz article here: The US shale oil boom is saving the world almost $5 billion a day