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Is fracking a factor in the Middle East?

Not really.

The reality is the KSA enjoys market power by dint of (1) actual reserve vol (B/D delivered) and imagined reserve vol, (2)producer combination (OPEC + Russia), (3) government combination (domestic "autocracy"), combined operating expertise (industrial, financial, geopolitical R&D), and (4) pricing power independent of complementary industry operators--so-called "swing producers", wildcatters or "independent" MNCs. They are price takers. Since The Great Disenfranchisement, OPEC embargo (Proof of Concept), their crude attempts to disrupt supply chain management, represented and led by the KSA, are legend.

Here is perennial, proverbial verse from the trades. Ghawar vs. Permian Basin: Is There Even a Comparison? Sure. SWOT.

The KSA purported interest in "fracking" (heavy crude extraction technique) from domestic reserves is academic. Anyone besides me recall hysterical Anglo-merican press reactions from "boom" to and bust of horizontal rigs orchestrated by the KSA? The top of the market (P > R-C) was just 5 years ago.

OPEC "ceded no ground in their battle for market share amid a supply glut"


That is, stories about a KSA "fracking boom" recently popularized in N.A. (principal KSA antagonist) are not only propaganda but speculative proposals to "revive" investment in  high-risk ventures which failed. Here is an example in the Globe and Mail --remote organ of Alberta tar sands marketing down the Mississippi to US refineries. Note reference dates of KSA shale R&D, beginning 2011.

Oil and gas rig counts, oil and gas prices (spot, forward, retail), and chart porn: What's the correlation? Uninterrupted supply of trash talk.

Here's a sample description of US rig operators' current debt position.
Here's a sample description of current US refinery capacity and utilization

Diversification in the industry does not imply diversification of the industry.

Diversity is the key to economic and political evolution.

by Cat on Thu Aug 22nd, 2019 at 03:24:04 PM EST
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