A boom in shale oil and gas production will challenge conventional oil in the long term, Kuwait oil minister Mustafa al-Shamali said in remarks published late Sunday.
A boom in shale oil and gas production will challenge conventional oil
in the long term,
Kuwait
oil
minister Mustafa al-Shamali said in remarks published late Sunday.
The shale boom, however, won't have an impact on oil in the short or medium
term and the exports of Gulf Arab producers to the United States haven't been
affected yet, Mr. Shamali said, according to the official Kuwait News Agency,
or KUNA, but he didn't elaborate on the challenges.
U.S.
oil
production has surged thanks to new drilling and extraction methods in places
such as
North Dakota
and
Texas
,
boosting output of "shale" or "tight" oil. Some analysts
say that threatens demand growth prospects for the Organization of the
Petroleum Exporting Countries, a cartel of some of the world's biggest oil
producers including
Kuwait
.
OPEC secretary general Abdalla Salem el-Badri, however, told The Wall Street
Journal last week that the boom in
U.S.
shale
production won't last, and the world will need more oil from the group by the
latter half of the decade.
The comments of Mr. Shamali and Mr. El-Badri come after some OPEC members have
in recent months offered varied reactions to mounting
U.S.
production. In May, Nigerian Oil Minister Diezani Alison-Madueke warned that
rising tight oil production is a grave concern for African OPEC members, who
collectively saw their shipments to the
U.S.
fall
41% from 2011 to 2012, according to data from the U.S. Energy Information
Administration.
By contrast, OPEC kingpin
Saudi
Arabia
last month acknowledged the
rising impact of the
U.S.
boom
without voicing any specific concern.
In a separate note, Mr. Shamali said that crude price of $100-$110 a barrel is
currently fair for all parties, whether producers or consumers.
Kuwait
is
currently producing around 3.2 million of crude oil a day and is on track to
increase its capacity to 4 million barrels by 2020, he added.
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