there Oil production In the Texas Permian Basin has reached its peak, ensuring an increase in price a $150 per barrel. The Permian Basin is the largest known oil resource in the United States and is located on the southern border with Mexico.
the United State It became a net exporter of oil and gas after the shale revolution of 2010. This even gave the US oil producer access to crude oil from basins that were previously considered unusable.
there The shale revolution It changed the geopolitics of oil. Prior to 2010, the United States maintained close relations with the Organization of Petroleum Exporting Countries (OPEC) led by the Kingdom of Saudi Arabia. The United States will provide security forKingdom of Saudi Arabia While OPEC will continue to export cheap crude oil to the United States.
But the shale revolution changed the balance. Suddenly, the United States no longer needed Saudi oil and was therefore less committed to defending it.
Saudi Arabia, the world’s largest oil exporter, now prefers to deal with America’s enemies and join the coalition Russia In reducing production that artificially inflates world prices. Since July, this joint effort has reduced global oil production by 3.6%, and the two countries have confirmed that it will continue until at least the end of 2023.
At the moment, the price of oil is hovering around a threshold $90 per barrelAs the United States seeks more imports from neighboring Canada.
$150 per barrel
Despite its best efforts, the United States cannot afford it Oil war Against Saudi Arabia. Unfortunately for the United States, oil reserves in the Permian Basin are reaching peak production and, according to some experts, will likely be exhausted by 2018. 2040.
Unless additional oil supplies miraculously arrive, Texas producers widely expect the global price to reach that level $150 per barrel. «This will send shock waves throughout the system», warned Continental Resources CEO Doug Lawler.
Oil prices are driving the current increase inEconomic inflation In the United States, though, the general decline in prices has been offset by. However, a spike in crude oil prices could return the US to 2022 inflation levels.
there Federal Reserve The inflation file must be closed quickly. Interest rates are at a 22-year high and the economy is slowing. A recession has been avoided so far thanks to the resilience of the post-Covid economy, but it won’t last forever.
Chairman of the Federal Reserve Bank Jerome Powell He pointed out that interest rates will remain at their current levels 2025. If these increases are not enough to combat inflation, further increases will almost certainly lead to recession.
The United States cannot afford a recession in 2024. Economic contractions during an election year often cause very unpleasant effects, both at home and abroad.
Article published on Money.it International Edition On 2023-09-28 10:31:36. Original title: “Shock waves through the system”: US oil prices may reach $150, CEO warns
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