BP CEO: Shale gas 'very painful' for much of world

BP CEO: Shale gas 'very painful' for much of world·CNBC
CNBC
0

The shale gas revolution will be "very painful for many parts of the world," with the U.S. potentially the globe's new swing producer, the head of BP told CNBC on Tuesday.

The nascent shale industry-in which "unconventional" gas is drilled from the ground through hydraulic fracturing or "fracking"-is heavily dominated by the U.S. It has boomed in recent years, partly as a result of access to cheap financing, helping to push global oil prices (New York Mercantile Exchange: @CL.1) to record lows.

BP (London Stock Exchange: BP.-GB) CEO Bob Dudley told CNBC that the "revolution" (his word) meant the U.S. might supersede Saudi Arabia as the world's major swing oil producer, able to alter its production to balance supply and demand.

He saw the price of oil-which has recovered somewhat this year but is still down around 40 percent from the $100+ levels seen before July 2014-remaining "lower for longer."

Read More Pipe dream: Why US oil will never go it alone

"There will undoubtedly be stress out there if oil prices stay lower," Dudley said.

He added that there could be further consolidation in the energy industry in this scenario, but that he saw BP as neither "predator nor prey" currently.

Along with shale gas production, the refusal of the Organization of Petroleum Exporting Countries ( OPEC ) to cut production is viewed as a factor in the tumble in oil prices. The body will hold a key meeting on Friday at which it is expected, once again, to hold production at 30 million barrels of oil per day.

Read More Saudi oil minister 'not stressed' as OPEC meet looms

Dudley said that the "winners" from low oil prices were "clearly" importers like China, India, Indonesia and much of Europe. Even the U.S. was a beneficiary, he said, because the coastal states are predominately net importers of oil rather than exporters.

He added that BP intended to maintain its presence in Russia , despite tensions with the West, with no plans to sell its 20 percent stake in Rosneft. The Russia oil company is majority-owned by the Russian state and CEO Igor Sechin has close ties to Vladimir Putin .

Read MoreRosneft chief earns up to $4.7M in basic salary

"We stay out of the politics," said Dudley, adding, "We have a lot of experience in Russia ... our commitment is to remain."



More From CNBC

Advertisement

Recommended Stories

  • Jeff Bezos' Most Prized Possession Breaks Historical Auction Records At Almost $53 Million

    Jeff Bezos amassed his wealth through Amazon stocks and owns hundreds of millions of dollars worth of real estate, but one of his most valuable possessions may surprise you: art. Among his collection is the renowned piece "Hurting the Word Radio #2 (1964)" by Ed Ruscha, purchased by Bezos for almost $53 million. This artwork, a prime example of Ruscha’s text-based paintings, stands as a signature piece in Bezos’ collection. As concerns over stock market volatility persist, the world’s wealthiest

  • Warren Buffett's Latest $2.6 Billion Buy Brings His Total Investment in This Stock to More Than $77 Billion in Under 6 Years

    The Oracle of Omaha has purchased shares of his favorite stock for 23 consecutive quarters.

  • Anthropic now lets kids use its AI tech -- within limits

    AI startup Anthropic is changing its policies to allow minors to use its generative AI systems -- in certain circumstances, at least. Announced in a post on the company's official blog Friday, Anthropic will begin letting teens and preteens use third-party apps (but not its own apps, necessarily) powered by its AI models so long as the developers of those apps implement specific safety features and disclose to users which Anthropic technologies they're leveraging. In a support article, Anthropic lists several safety measures devs creating AI-powered apps for minors should include, like age verification systems, content moderation and filtering and educational resources on "safe and responsible" AI use for minors.

  • Bluesky now lets you personalize main Discover feed using new controls

    Bluesky is now allowing users to personalize their main Discover feeds. The social network is rolling out an updated version of its app that lets users offer feedback about its algorithmic feed so they can better customize it using "Show more like this" and "Show less like this" buttons in a post's menu to choose which content the algorithm surfaces. The change will help Bluesky users create a timeline that takes into consideration their own preferences, not what the company thinks they should see.

  • With Apple entering the fight, the AI chip wars have gone nuclear

    The AI PC chip wars are going nuclear as Apple officially joins the fight with its M4 processor.

  • I Finally Decided to Cut My Losses and Sell This Stock -- Here's Why

    This real estate technology company could be hit hard by a changing real estate market.

  • Palantir Stock (NYSE:PLTR): Should You Buy the Post-Earnings Dip?

    Palantir stock (NYSE:PLTR) dipped by about 16% after its Q1 earnings report, prompting me to ponder whether this downturn presents a buying opportunity. Notably, Palantir showcased yet another quarter of solid revenue growth, promising client base expansion, and strong profitability metrics. That said, concerns persist regarding the stock’s elevated valuation. Consequently, despite my belief in Palantir’s long-term prospects as a shareholder, I maintain a neutral stance towards the stock at pres

  • Stock Market News for May 10, 2024

    Wall Street closed sharply higher on Thursday, with interest rates still dominating the proceedings.

  • 3 Rock-Solid Dividend Stocks That Are Ideal for Retirees

    These are low-risk stocks with high yields.

  • McDonald’s Will Offer a $5 Meal Deal to Lure Customers Back Into Stores

    (Bloomberg) -- McDonald’s Corp. is looking to launch a $5 meal deal in the US that the burger chain is betting can lure penny-pinching consumers back in.Most Read from BloombergElon Musk Pledges to Grow Supercharger Business He Just DecimatedApple Nears Deal With OpenAI to Put ChatGPT on iPhoneBiden Set to Hit China EVs, Strategic Sectors With TariffsJim Simons, Code Breaker Who Mastered Investing, Dies at 86Ice Cube’s Big3 Basketball League Sells Its First Team in $10 Million DealThe deal could