All in all, the positive oil-price shock adds more than two per cent to global G.D.P. But perhaps the most fascinating question arising from OPEC’s decision is what impact it will have on the North American fracking industry, which is, in many ways, its ultimate target. Fearful that booming production of shale oil would lead to a permanent glut of crude, which would keep prices low indefinitely, OPEC’s members, particularly Saudi Arabia, are declaring war on the frackers, by allowing the price of crude to fall to a level at which a lot of American companies would lose money on their shale operations. The vice-president of the Russian company Lukoil, Leonid Fedun, told the Financial Times that OPEC’s hope is to turn the U.S. fracking boom into a bust.
Posted on: Fri, 19 Dec 2014 18:07:44 +0000
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