The US Shale Oil Boom and Oil Market Fluctuations: An Analysis from International Political Economy Perspective

Abstract

From an international political economy perspective, this article aims mainly at looking at the effects of the shale oil production on the global energy market and crude oil price fluctuations, in a context of overlapping economic and political interests for exporters and importersas well.

While the interests appear to be economically contradictory for Saudi Arabia as the most important producer of crude oil on the one hand, and the United States, the most important shale oil producer, on the other hand, it seems that there are converging interests between them.One significant interest is the economic pressure they exercise on regional and international powers such as Iran and Russia.

The article concluded that it is necessary to review the widespread belief that the price of crude oil is governed by economic factors; the rate of supplies, the size of reserves, and the extent of alternative energies such as shale oil. Such factors are to be associated with geopolitical factors based on the national security requirements of the most important market players.