I am of the opinion that the new drilling technologies such as fracking and horizontal drilling have opened up so much additional oil that the global market will be “capped” price wise for a long time.
Remember that while the US is using a lot of this technology, it has not spread to a number of the other major oil producing nations .... yet.
That is false. Haliburton, Baker Hughes, Schlumberger and Weatherford perform the majority of the US hydraulic fracturing activities and are all international companies.
yikes. i hadn’t thought about that....
“I am of the opinion that the new drilling technologies such as fracking and horizontal drilling have opened up so much additional oil that the global market will be âcappedâ price wise for a long time.”
Depends upon what you think is a ‘long time’. It could be a couple of decades.
As a reservoir engineer who has worked unconventionals extensively, the problem I see is that there are only selective places that this will work. Oil is just so tough to flow through such tight rock, the rock must be fraccable, the rock must be in the proper maturity setting, etc. Places like the Bakken and Eagleford or pretty unique settings.
Now gas is a completely different matter. Gas flows much easier. What the industry has unlocked is a ‘burp’ for oil but could be considered virtually infinite as it will last many generations for gas.