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11-23-2012, 02:11 PM | Topic Starter |
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Fracking to lead to a new golden age?
Dunno if this should be in DC or not, but it seems more societal than political. I thought it was interesting and had no idea that fracking would have that big an impact.
I added the bold formatting in places because doing so will draw your attention to it since I think it's interesting. http://www.cnn.com/2012/11/23/busine...html?hpt=hp_c1 U.S. set for fracking bonanza, says historian Ferguson By Andrew Stevens, CNN updated 12:30 PM EST, Fri November 23, 2012 Hong Kong (CNN) -- If there's been one consistent thread running through the U.S. economic story since 2008, it's been the steady drumbeat of gloom. Outright recession or sub-standard growth, stubbornly high unemployment and fiscal crises have been the topics du jour when it comes to the world's biggest economy. But now an unlikely champion for U.S. growth under the Obama administration has emerged -- a former adviser to a Republican Party presidential candidate and Harvard history professor, Niall Ferguson, who says America could actually be heading toward a new economic "golden age." And it has nothing to do with Washington and everything to do with energy. Ferguson, who is also an author and commentator, believes the production of natural gas and oil from shale formations via a process known as "fracking" -- forcing open rocks by injecting fluid into cracks -- will be a game changer. "This is an absolutely huge phenomenon with massive implications for the U.S. economy, and I think most people are still a little bit slow to appreciate just how big this is," he said in Hong Kong this week. "Conceivably it does mean a new golden age." U.S. energy production has been booming in recent years. The International Energy Agency made a jaw-dropping forecast two weeks ago that the U.S. would pass Saudi Arabia as the world's biggest oil producer by the end of this decade -- and would achieve near energy independence by the 2030s. That energy boom, asserts Ferguson, will create jobs in the United States. Lots of jobs. The energy sector currently supports 1.7 million American jobs directly or indirectly, according to economic forecaster IHS global Insight. That could rise to 3 million by 2020, it says. "It's not only in the extraction industry and infrastructure, but more importantly cheap energy is going to create employment in manufacturing. I think you'll see a renaissance in manufacturing," said Ferguson. "That is being helped by the fact U.S. labor costs have been pretty competitive over the past decade, even as labor costs are going up in China." It is also, he says, a big deal for the dollar. "As the U.S. moves towards energy independence and becoming the biggest producer in the world, the dollar can only benefit. Anybody who thought the financial crisis was going to lead to the demise of the dollar as an international currency is wrong -- it's quite the opposite." And what of U.S. engagement in the Middle East? Ferguson says it would be naive to assume that Washington would withdraw in any significant way from the region. "Nobody is going to step in and take the job of being global policeman in charge of Middle Eastern stability. I think everyone would be nervous, if the Chinese suddenly volunteered to take that job on, which by the way they are not going to do anytime soon," he said. For the recently reelected U.S. president though, the energy boom looks like it could provide a welcome tailwind for his second term. It's something that Ferguson acknowledges -- though one suspects through gritted teeth. As a supporter of Mitt Romney he penned a controversial pre-election cover story in Newsweek headlined "Hit the Road, Barack," which was highly critical of the president's first term. He concedes the irony that the president will now be the beneficiary of the "good times that lie ahead." |
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11-23-2012, 02:19 PM | #2 |
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These things never live up to the fracking hype.
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11-23-2012, 02:21 PM | #3 |
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I hope this ain't no Fracking joke !
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11-23-2012, 02:24 PM | #4 |
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Yes, it is an interesting prediction. However, the energy companies are under no obligation to sell and refine the crude for purely American consumption.
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11-23-2012, 02:54 PM | #5 |
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11-23-2012, 03:30 PM | #6 |
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It really isn't a secret. Even though some of this oil will be exported, it's still a beneficial thing for every American.
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11-23-2012, 04:38 PM | #7 | |
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Every election cycle, people claim "But gas prices were less under "John Doe"! The POTUS nor his policies do very little, if anything, to affect the price gasoline and anyone that claims as such is either a liar uninformed. |
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11-23-2012, 04:53 PM | #8 | |
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Why are you bringing up politics? I was referring to there relatively suddenly being a new flow of oil coming into the global market. One of the items that is very closely watched is the global spare capacity. If we start putting millions more barrels of crude into the market, it eases the space capacity concerns. That has nothing to do with politics.
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11-23-2012, 03:01 PM | #9 | |
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We have LNG import facilities that were built just a few years ago. Now, with the relatively low NG production costs compared to those in Europe, some are discussing conversion of those import facilities to export facilities. However, the oil and gas industry is backing off that type of planning due to the realizaton that Europe and China have plenty of frackable resources. Ultimately as fracking technology spreads, a global market become established with more uniform prices for NG, resulting in less incentive to export. |
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11-23-2012, 06:21 PM | #10 |
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Wouldn't the cost of export mean that our own demand will be mostly met before it economically makes sense to ship oil out?
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11-23-2012, 07:32 PM | #11 |
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Not if the importing party is willing to pay the export costs. We also don't exactly have much spare refining capacity.
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11-23-2012, 02:35 PM | #12 |
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Energy independence but a destroyed environment.
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11-23-2012, 02:41 PM | #13 |
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I think that's somewhat overly dramatic.
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11-23-2012, 02:53 PM | #14 |
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you are correct. We don't need clean water fr crops or livestock.
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11-23-2012, 03:28 PM | #15 |
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Again, you are being overly-dramatic.
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