The USA seems to threatening Russia not only with a shale revolution but also with a shale war. The North-American shale boom seen in the region over the last few years, has been treated as the end of Russia’s oil and gas industry. Everything started from shale gas, which allowed the USA to turn from an NG importer into a net exporter of this energy carrier.
Yet, US officials do not conceal the fact that they are going to use this trump card to free Europe from the dependence on Russian energy carriers. Now American observers and analysts are discussing the gloomy prospects of Russia’s export of energy carriers caused mainly by the shale boom in the USA and worldwide.
What is really happening inside the US shale industry? Is Russia’s export of energy carriers to Europe doomed? Let’s have a closer look at the situation.
From shale gas to shale oil: the USA is creating new threats for the Russian economy?
Not so long ago, James Marson published an article in The Wall Street Journal. It is called Shale Threatens Russia's Economy.
The essence of the entire article is shown by the first line, which reads, “Russia's oil exports could plunge in the coming decades as the U.S. ramps up output of shale oil… Russia, the world's largest energy producer, is already seeing its natural-gas exports shrink, partly as a result of the U.S. shale-gas boom…”
The negative effect of this shrinkage is estimated at billions of dollars. This is what some government-link experts think on the matter. They say that the US shale boom may reduce the forecast for Russia’s exports of energy carriers by 50 million tons per year within the next 25-30 years.
In its turn, such an export decline may eventually have a major impact on the Russian economy as Russia’s energy industry accounts for as much as 25% of GDP. However, the share is expected to decline down to 15% over the next couple of decades.
You can read the full text by following the link down below:
http://online.wsj.com/article/SB10001424127887323741004578414582783570350.html
Shale Threat or Shale Fraud: Expert Opinion
According to Eugene Olkhovsky, Masterforex-V Academy’s leading experts in financial markets from Canada, despite referring to the gloomy forecast made by a group of government-linked experts, the author of the article makes no distinct conclusion. However, the pessimistic tone of the article gives us to understand that Russia’s economic prospects are gloomy.
It seems like the author is trying to convince the audience that the North-American shale boom is an inevitable major threat to Russia. Yet, he is not alone. In 2011, United Press International wrote about the shale boom as salvation of Europe from the energy dependence on Russia.
Still, such an opinion is popular in the Western media only. Even Foreign Policy, a respected US edition, wrote that all the hopes for the shale boom in Europe had failed. Some European countries have already banned fracking as it is considered dangerous to the environment. Therefore, there is no shale boom in Europe.
Moreover, shale production is not always profitable even in the USA, not to mention the export of shale oil and gas to Europe.
Moreover, even those experts have to admit that the potential environmental danger of shale production outweighs all the possible geopolitical bonuses. The current shale boom actually has few positive sides.
At the same time, oil prices are currently falling. In particular, the price of the WTI futures for May delivery (NYMEX) is down by $2,22 per barrel. Therefore, it is currently around $91,29/b.
The chart below, courtesy of Masterforex-V Academy, reflects the current state of affairs in the market of WTI oil:
And finally, it is necessary to keep in mind that the USA will keep using the shale boom as a weapon of info war against Russia. Therefore, Russia needs to implement countermeasures of the same nature, simultaneously restructuring its energy industry and letting Gazprom coming out of continuous dormancy.
