Global oil markets are flooded with cheap crude that is keeping prices low, and two large new oil fields have been discovered in United States, according to a recent New York Times article.
“The new finds, while still preliminary and in need of more testing, could further cement two realities of the energy business: Oil prices could stay low for a long time, and oil companies will keep seeking to increase their reserves for future production,” the article states.
“The discoveries have been hailed by the oil industry, even though companies have largely cut back on exploration over the last two years in an effort to reduce costs as oil prices fell from over $100 a barrel to roughly $50 a barrel,” The Times wrote. A surfeit of crude oil is not the only factor helping consumers; oil prices have been driven down by widespread conservation measures and the growing use of electric cars, according to the article.
The new oil discoveries are a 2.4 billion barrel field in the shallow waters off the North Slope in Alaska and a field in West Texas containing at least 3 billion barrels. Some analysts say they could be precursors to even more discoveries in West Texas and Arctic Alaska. “The new discoveries have also reinforced the confidence within the industry that the United States will remain a major oil power — capable of producing substantial amounts for itself and exporting major quantities around the world,” The Times wrote.
To read the New York Times article, click here.
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