Much has been written about fracking over the past several years, including its pros and cons. However, fracking has not only changed the landscape in a literal sense, but also figuratively.
Fracking has opened tight oil and gas fields in the United States that were previously seen as unreachable or usable. As a result, fracking has also helped to transform the global geo-political calculus. Take the recent Bloomberg Businessweek article titled, “There Would Be No Iranian Nuclear Talks if Not Fracking.” Iran sees a real threat in its ability to make waves in the international commodities market through the use of its oil as a weapon if the United States (and other countries) are able to produce more oil domestically and no longer have to rely on the Iranians for imported oil. As a result, Iran has sensed the threat and realized in order for the country to be able to continue to meet its obligations, it must confront the real questions posed by international community regarding its nuclear program. Iran hopes that some to regain some of the market share it has lost or seen erode as a result of the rise of fracking and sanctions imposed on the country.
Iran is not the only group feeling the heat generated by fracking. Another Businessweek article titled, “U.S. Makes more Oil than It Takes” also puts pressure on OPEC (the Organization of the Petroleum Exporting Countries) and threatens its dominance if one of its perennially largest customers becomes more energy independent. Businessweek noted that in the first five months of 2013 the United States met almost 86% of its energy needs through domestic production.
Fracking in the United States has also put pressure on Russia and other countries that rely on export of hydrocarbons for a substantial portion of their budgets. Coupled with the potential threat of the United States exploring actively exporting of liquefied natural gas, it puts real pressure on the worldwide market for gas.
While the benefits that come from fracking may not last forever, at least in the short term, fracking is proving to be a disruptive force in more ways than one.
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