Shale formation, a problem for OPEC?
OPEC's plan for production curb seems to have failed in the forth month. The new source of oil supply, the shales oil production, is causing problems for OPEC specially in an era where new advancements in technology widely become the standards of tomorrow.
The crude production in the United States is all set to pass its 2015 peak by July this year, if such a growth in production of oil in United Staes continues. US has increased its production by almost half a million barrels a day since OPEC's meeting of deciding to curb the production and most of the increase in production of US is due to Shale formations. Such a news of increase in production is not good for OPEC producers.
Market imbalance is not the only worry that the OPEC is facing. The new and emerging industry of shale formation is in its early stages. Though, for decades now in the oil industry, methods of horizontal drilling and hydraulic fracturing have been much in use, their vast employment to shale formation is not much old.
This imperceptible battle of OPEC with Shale must have just begun, but, experts suggest it may not last long. How does OPEC plan to deal with shale formation in the US which is still in its infancy?