OPEC is doomed. Their crazy rich lifestyle is doomed. What that might mean to their political/economic stability remains to be seen.
The U.S. shale boom is back and better than ever. After weathering a collapse in crude prices that saw the value of a barrel of oil drop from more than $110 in June 2014 down below $30 in January 2016, American fracking firms (the ones that survived, that is) are looking fit once again. As Bloomberg reports, these companies are already taking advantage of a petrostate production cut that ceded valuable market share and pushed oil prices back above $50 per barrel. . . .
So now, nearly three years after a global glut sent oil prices into a tailspin and American oil producers to their nearest lenders, U.S. oil production is once again floating above 9 million bpd. And as positive as this is for both the American economy and our country’s energy security, it’s a major threat to oil-soaked states both inside and out of OPEC. Those petrostates banded together late last year to finally agree on a production cut, and they managed to induce a price rebound of roughly $10 per barrel as a result. Now, however, their worst fears are being realized: U.S. shale producers are seizing the opportunity and bringing rigs out of retirement.