At least two decades of market uncertainty have kept Americans worried about the future of production costs and world market dominance. Fracking in the American Plains and middle regions have influenced a huge transition from complete reliance on near-Asian production, to the re-emergence of US-based goods and services.
The boom in the Dakotas and other fracking regions has reduced the gap between costs of production between the US and countries like China to a paltry 5%. This means, from the popularity of new domestic oil production, that it is absolutely viable for companies to stay in America rather than export production elsewhere. Fracking has been good for technical- and labor-intensive jobs in the field, but it has been meeting significant resistance from state officials concerned about the health of their lands and their constituents—New York has banned fracking in the state because of its potential health risks.
US Oil Fracking Is Our Foe
Fracking has been the source of some controversy. Its supporters champion its financial benefits, while its critics emphasize its environmental and economic hazards. For example, in early June, roughly 3 million gallons of the potentially toxic saltwater produced in fracking pipelines leaked into a North Dakota creek that flows into the Missouri River. Also, Kansas, Ohio, and Texas have all reported that they are experiencing many small earthquakes that rated approximately three on the Richter scale. There is substantial evidence that these quakes are in fact related to fracking.
There are also economic costs to consider, in addition to the problem of the “bust” following the “boom,” which North Dakota is now learning. While North Dakota has experienced a population boom, the development of the infrastructure has not kept up and officials are looking into “surge funding” to help pay for the cost of the expanding infrastructure—in one case, up to $1 billion. That funding is already in jeopardy because the taxes paid by energy companies are declining.
US Oil Fracking Is Our Friend
There is however, tremendous hope for American fracking. A glut of capable and skilled workers is available and waiting to make new US oil fracking wells produce oil like no other wells in the world. According to many reputable sources, the US markets are inclined toward supporting companies that use domestic supplies rather than imported oil sources. It is a magical market relationship that could spark a revolution if the right economic conditions fall into place. Whether the naysayers want to believe it or not, American fracking is an economic giant that could wipe out many modern economic concerns.
Statistics show that thousands of people are flooding to regions with fracking companies and the jobs they promise. Though many of the jobs are being put on hold because of temporary adjustments to international oil–trading indicators, the jobs have not been eliminated. With the foresight of leaders in the domestic oil futures market, US oil fracking dominance could outpace the production in other countries, put tens of thousands of Americans to work, and entice a revolution in domestic manufacturing.
Opposing Foreign Forces in Domestic Oil
Unfortunately, there are a number of reasons the American oil boom is being countered by market forces. Worldwide oil prices are in free fall. Fracking enterprises are creating the perfect conditions for the US as a whole to pull back reliance on foreign oil sources and look to the wells in its own backyard.
The highest echelons of market expertise are indicating that oil-producing nations sense a slowing of economies all over the world. This is even true in the United States. No matter how much cheap, new oil is discovered and put on the market, the lack of an industry to buy it will mean that prices will sink.