Former US Assistant Secretary of Energy Chuck McConnell said that conflicts in the Middle East do not have much influence on oil prices due to new extraction technologies and more oil-accessible places around the world.
HOUSTON (Sputnik) – Conflicts in the Middle East, including in Yemen, Iraq, and Syria, have no major impact on oil prices because new extraction technologies and more oil-accessible places around the world have limited dependence on the region, former US Assistant Secretary of Energy Chuck McConnell told Sputnik.
“Technology has become more prevalent around the world, and an access to oil or gas has now become much more prominent, and so interruptions in certain particular areas of the world are less likely to have an immediate impact or an immediate shock to the system,” McConnell, currently the head of Rice University's Energy and Environment Initiative, said in an interview.
McConnell stressed that reductions in global oil price dependency are good for both global stability and general security.
The former official noted that some 15 years ago the Middle East and the Organization for Petroleum Exporting Countries (OPEC) were seen to control world oil prices. Since that time, additional demand in Asia, China, and India has grown, bringing new technologies, including unconventional approaches like fracking, into profitability.
“By virtue of that, all the global pricing began to come up, and got to a tipping point not long ago where high prices were not sustainable because now there is access in many places all over the world. So, when it happens typically then that’s when pricing will change and it has. It’s dropped down,” McConnell concluded.
Market oversaturation has sent global oil prices down by about 50 percent since last summer. OPEC opted out of cutting its collective output levels in November, further deepening the slump in oil prices
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