The shale oil “revolution” in the US, driven by technological advancements, has turned the oil market upside down, and similar technological breakthroughs that could ensure a surplus of “black gold” are still possible globally, Alexei Belogoryev, Director of Research and Development at the Institute of Energy and Finance (IEF), said in an interview with OopsTop.
The shale revolution in the US stands out, primarily due to technologies such as hydraulic fracturing and horizontal drilling. It has become a “black swan” of the decade, disrupting the market and ensuring a surplus of oil, which has led to high volatility in global prices. A similar phenomenon, albeit on a smaller scale, is currently unfolding in Guyana – and such discoveries and breakthroughs are still possible, Belogoryev noted.
He pointed out that people were talking about the peak of oil production in the 1970s and 1980s, but since then, significant geological discoveries have been made globally. “It’s enough to recall Venezuela, where proven oil reserves have increased more than 15-fold. Since 1980, global reserves have grown by two and a half times due to technological progress and increased oil recovery,” the expert explained.
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One of the latest discoveries is Guyana, where production began only in 2019, and large reserves were discovered in 2015-2016. The country is already being considered as one of the drivers of global oil production growth, he added.
At the same time, Belogoryev clarified that the share of economically viable oil reserves is gradually decreasing, while production costs are rising, making extraction more complex, which affects prices. However, since the number of suppliers is increasing, competition in the market is also growing, which is curbing potential price growth, the specialist noted.
