Oil Price Rises: Will This Give USA a Cutting Edge?
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Spurred by higher prices per barrel, U.S. oil production is on an upward trajectory. When oil prices reach $60 a barrel, as they have recently done, drilling rushes occur. This explains why the U.S. oil rig count went up more than a third this past year.
And now, the United States is on track for overtaking Saudi Arabia and matching Russia as a leading oil source. The Trump administration is, meanwhile, easing restrictions on offshore drilling and other fossil fuel extraction.
At the same time, the United States is becoming a major exporter of natural gas from hydraulic fracturing, which responds more quickly than conventional oil drilling does to market fluctuations. Chevron and Exxon Mobil are ramping up their investments in shale, especially in North Dakota, Texas, and New Mexico. Texas ports are shipping hubs for natural gas exports to China, India, and other buyers.
The boom is expected to transform the United States, which is still a major oil importer, into a net fossil fuel exporter. And the increased output options promise a buffer against political instability in North Africa and in Venezuela, Iran and Saudi Arabia, according to a recent piece in the New York Times.
The Other Side of the Coin
By 2025, the worldwide daily consumption of oil is expected to exceed 100 million barrels.
This worries environmentalists. World CO2 emissions rose in 2017 after three flat years. Additionally, cumulative or “natural sinks” of CO2 emissions, measured through readings of stored carbon in our atmosphere, water, and on land, have grown in the last decade due to industrial carbon releases.
By expanding oil and gas supplies, banking on export growth, and lowering prices for consumers at home, natural gas extraction sustains national reliance on fossil fuels at our peril, and at significant environmental costs. It also diverts attention and investments from clean energy innovations.
The appeal of the green innovation sector will dampen demand for fossil fuels over time. But scientists warn that carbon released in the next few years will worsen our long-term climate crisis.
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