Since the U.S.-led shale oil revolution got rolling around 2008, OPEC’s strong-but-never-absolute power to set world crude oil prices has been threatened. Today, we are seeing another OPEC-inspired struggle in this vital market.
OPEC shakiness has intensified as U.S. petroleum exports expanded from 40 billion barrels in 2010 to 200 billion barrels this year. Meanwhile, by opening and closing the largest petroleum supply in the Arab world, Saudi Arabia attempted to steady the price of oil. At one point, around 2014 and in conjunction with Russia, the Saudis put a squeeze on U.S. shale producers by pushing prices below what they believed to be shale oil production costs. U.S. shale producers sat tight and kept on pumping. Oil prices seemed stuck at a relatively low level, and U.S. drivers enjoyed a gallon of gasoline for $2.50.
