Also popular: Is the Shale Bubble already beginning to burst?

Also popular: Is the Shale Bubble already beginning to burst?

Also popular: Is the Shale Bubble already beginning to burst?

For several years now mainstream publications have been filled with stories about the amazing boom in crude oil production coming from so-called shale basins. As the story goes new hydro-fracking technologies are making it possible to harvest new sources of oil from "tight oil" formations like the Marcellus shale. As the mainstream media has put it, there is a "revolution" in domestic American oil production that is changing global energy markets. 

There is reason for optimism. For the first time in years, American production—the total amount of oil coming up from all the nation's oil wells—is rising. The peak in production of conventional crude oil in America was in 1970 when daily production hit 10.5 million barrels a day. Since then production has generally fallen. Production declined after November 1970 until the mid-1980s, when new production of crude in Alaska and deeper waters of the Gulf of Mexico temporarily stemmed the decline in conventional production. A so-called "secondary" peak in American production occurred then. But as the big old onshore conventional fields continued to give way, as production moved further out into the gulf, production began to decline again by the end of the '80s, falling all the way through to the mid-2000s when American domestic production dropped to just 5.5 million barrels a day. Since then the shale boom has stemmed the declines, and production began to rise again. But this current increase in production is limited. This is the "tertiary" peak in American production according to peak oil activists. The current rise in production will only last so long, is already giving way according to the latest thinking.

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