Shale oil production in the US is facing serious destabilization

March 27 2020 10

Currently, the demand for oil in the world is in free fall. This is due to the spread of coronavirus infection COVID-19 on the planet and is exacerbated by the inability of Moscow and Riyadh to agree to reduce the production of raw materials. Now problems are expected from the “shale” of the United States and LNG exporters. This was announced on March 26, 2020 to the “Atlantic Council” by the head of the International Energy Agency (IEA) Fatih Birol.

For clarity, the Atlantic Council, headquartered in Washington, is an American, non-governmental, analytical center with a specific focus. Moreover, it is so specific that in July 2019 this organization was recognized as undesirable in Russia and entered the corresponding registry of the Ministry of Justice. According to the conclusions of the Prosecutor General, this structure threatens the foundations of the constitutional system and security of Russia.

According to Birol, many experts predict a surplus of oil in the world market. In this case, the effects of oversaturation will be felt for many years to come, and the recovery in demand will not be quick.

Today, 3 billion people in the world are isolated. As a result, global oil demand is in free fall, and we can see a drop in demand to as much as 20 million barrels per day

- explained the head of the IEA.

Birol believes that in the second quarter of 2020, there may be a significant decrease in shale oil production in the United States. The head of the IEA emphasized that the US oil industry is waiting for "enormous suffering." But the industry will recover, after the restoration of oil prices in the world market.

With these prices, we will see a significant decline in oil shale production in the United States, there is no doubt

- clarified Birol.

Birol added that gas demand in Europe and Asia was also "severely affected." So serious problems await LNG exporters from Australia, Algeria, Qatar and the USA.

I expect that LNG in the US will also be affected. We can see many closures all over the world.

- said Birol.

After that, the head of the IEA advised taking measures to improve energy efficiency as part of incentive programs. economics. In addition, he drew attention to the fact that in connection with the current situation in the world, a reduction in greenhouse gas emissions is expected by the autumn of 2020. Birol promised that in two weeks he would publish more specific forecasts for oil demand.

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Natan bruk

+2

27 March 2020 15: 37

This should concern Russia and the oil monarchies most of all. Even if all of the US shales are closed, it will not be a tragedy for the US budget. It is not built on oil and gas. But for Russia, the collapse of oil and gas revenues is a disaster.
1. Ivan Ivanov_18
  
  -2
  
  27 March 2020 17: 27
  
  for Russia, the collapse of oil and gas revenues
  
  Article about the collapse of the shale, not?
  1. Natan bruk
    
    0
    
    28 March 2020 01: 05
    
    Yes, that's why it's funny.
    1. Ivan Ivanov_18
      
      0
      
      28 March 2020 07: 25
      
      Strange, but not all Jews are smart.
      1. mor7d
        
        -4
        
        29 March 2020 12: 39
        
        It is true that all Jews are smart, but it is not true that all smarts are Jews.
Bakht

+1

27 March 2020 16: 53

A strange idea of the budget and the disaster. Any (!) Modern state rests not only on one source of replenishment of the budget. So Russia has something to take care of, but this is not a disaster. It will be difficult, but solvable.
Let's move on to the shale producers of America. This is not a disaster for them until the end of the year. It has been written a hundred times that their activities are hedged. That is, it is insured against collapse. The problems will not be with the shale companies, but with the banks that insured them. Everyone remembers what the collapse of only one bank of the "Limonov Brothers" led to. The problem is the bankruptcy of banks and the collapse of the entire (ALL) financial structure. This is where the dog fumbled. It's no longer up to the budget. The budget is nonsense. Well, and a trifle like hundreds of thousands of unemployed in Texas alone - and goodbye to the White House for Trump. What will happen next is written with a pitchfork on the water.
For some reason, the Minister of Finance (important) runs around the world and asks (or demands) to reduce production. Doesn’t he know that these are the problems of Russia?
1. Natan bruk
  
  +1
  
  28 March 2020 01: 04
  
  Everyone runs around and takes care of their pocket. Including Russia. Comparison with Lemon Brothers is completely incorrect. There was something completely different - large-scale fraud. In the case of shale workers, as already mentioned, for the budget and the banking system this will be nothing more than a nuisance and certainly not a collapse of the banking structure. And Texas is far from just oil. And all the horrors that the United States expects in connection with the collapse of oil and gas prices are nothing more than the sweet dreams of the “patriots”. I remember how 8 years ago, at the second election of Obama, when the circus began with the "separation" of Texas, Russian "analysts" were excited. In all seriousness, they broadcast how the United States would soon break up, told what the new countries would be called, etc. :))) But Russia, of course, does not rely on one source of budget, but it is the main one, and on this basis it is planned. With the existing trend, a massive sequestration awaits him in all areas, and the NWF will eat through very quickly. The people are already in tension over the arrogant “zeroing”, and here also the inevitable powerful blow to their pocket. Therefore, he wrote about the impending disaster.
  1. Bakht
    
    0
    
    28 March 2020 09: 11
    
    You wrote that this should worry primarily Russia and the oil monarchies. This should be of concern to everyone. Including the USA. I wrote that for some reason this worries the US Treasury Secretary and the Texas authorities. By the way, in Texas. I went there on business. Flags hung USA and Texas. I often heard that it was not Texas that joined the States, but the States joined Texas. The tendencies of independence have always been strong there. And Houston was then called the "dead city".
    On a budget. Russia's budget is laid out in rubles, not dollars. The price of oil there is inherent in 2790 rubles. Divide by the dollar and get a deficit-free budget. And Russia can print as many rubles as the States print dollars. But this is in theory. In practice, they cannot be printed in large quantities because of the convertibility of the ruble. The printed money will go to the exchange, it will be converted into dollars and exported abroad. Therefore, the decision on a 15% tax on the export of foreign currency is not even half measures, but visibility. We need a complete ban on foreign exchange operations on the exchange, a refusal to convert. You need to disconnect from the crazy printing press in the USA. And Russia will be completely happy and financially independent.
    So. The budget of Russia is made up in rubles and at a floating rate is deficit-free. Inflation can rise and fall in the purchasing power of the population. But she is falling in the States. So this is a problem for everyone. And primarily the States.
    1. Bakht
      
      0
      
      28 March 2020 09: 49
      
      Addition to the budget. The pessimist claims the bottle is half empty. The optimist claims that the same bottle is half full.
      
      The rate is 80 rubles per dollar. Nightmare. We must pay 80 rubles per dollar. To whom to give? Central Bank. That is, to the budget of the Russian Federation. But for offshore, this is not just a nightmare, but a nightmare-nightmare-nightmare. It is necessary to give 80 rubles plus 15% (that is, another 12 rubles). Total for fans to warm their hands (speculators) should be given to the budget of the Russian Federation 92 rubles.
      
      In fact, there are already two courses in Russia. Domestic at 80 rubles and external at 92 rubles. And these 92 rubles go exactly to replenish the budget. We multiply $ 25 per barrel by 92. We get 2300 rubles per barrel. Not enough. The interest on the withdrawal of capital should be at least 30%. Better 50%.
mor7d

-4

29 March 2020 12: 36

Now the Saudis and the Americans will agree on the division of the market and that’s all, no one else will go there, the obstinate Americans will be crushed by sanctions.