A couple of informative graphics on Oil Production and the revival of the Texas oil boom years...WTF! (With The Fracking)...What did you think I meant?

According to the graphic below, countries that are classified as democratic (relatively "free") produce about 16% (US 9%, Canada 4%, Norway 3%) of the world's output of crude oil. Collectively, countries deemed less democratic produce about 54% (rough estimate just eye-balling the graph).



Source: Bloomberg (HT: Carpe Diem)

 Here is a chart showing the country of origin for US imports of crude oil. Several of the same names appear on both illustrations. 


Source: EIA

 I do find it interesting that China is a big producer of oil in the marketplace BUT the US imports virtually no oil from them (only about 2,000 barrels a month according to the IEA).

According to the NYTIMES , in short order, the US could increase  production by 25%, moving the US from 9% to approx 11.25% of world production.

"The Texas field, known as the Eagle Ford, is just one of about 20 new onshore oil fields that advocates say could collectively increase the nation’s oil output by 25 percent within a decade — without the dangers of drilling in the deep waters of the Gulf of Mexico or the delicate coastal areas off Alaska. More than a dozen companies plan to drill up to 3,000 wells there in the next 12 months."

However, this would require "drill baby drill" and all the negatives that brings with it..

""There is only one catch: the oil from the Eagle Ford and similar fields of tightly packed rock can be extracted only by using hydraulic fracturing, a method that uses a high-pressure mix of water, sand and hazardous chemicals to blast through the rocks to release the oil inside.


The technique, also called fracking, has been widely used in the last decade to unlock vast new fields of natural gas, but drillers only recently figured out how to release large quantities of oil, which flows less easily through rock than gas. As evidence mounts that fracking poses risks to water supplies, the federal government and regulators in various states are considering tighter regulations on it.""

That is the bad news.  The good news is that it could bring prosperity to local and state governments...

"...The companies estimate that the boom will create more than two million new jobs, directly or indirectly, and bring tens of billions of dollars to the states where the fields are located, which include traditional oil sites like Texas and Oklahoma, industrial stalwarts like Ohio and Michigan and even farm states like Kansas..."

Opportunity Costs abound! What do states with declining revenues and high unemployment do?  How do local communities balance the need for more local revenue AND retain/maintain their quality of life? 

Bottomline: WE GOTTA GET OFF THIS CRUDE OIL STUFF!


HT: Carpe Diem---How could I live without this blogger!! :)