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The U.S. Fracking Boom: Impact on Oil Prices

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  • Manuel Frondel and Marco Horvath

Abstract

As of late 2008, the steady decline of U.S. crude oil production over the last decades was reversed by the increased adoption of the hydraulic fracturing ("fracking") technology. Adapting the supply-side model proposed by Kaufmann et al. (2004) to assess OPEC's ability to influence real oil prices, this paper investigates the effect of the increase in U.S. oil production due to fracking on world oil prices. Among our key results obtained from (dynamic) OLS estimations, there is a statistically significant negative long-run relationship between increased U.S. oil production and oil prices.

Suggested Citation

  • Manuel Frondel and Marco Horvath, 2019. "The U.S. Fracking Boom: Impact on Oil Prices," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4).
    • Handle: RePEc:aen:journl:ej40-4-frondel
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    Cited by:

    1. Donia Aloui & Stéphane Goutte & Khaled Guesmi & Rafla Hchaichi, 2020. "COVID 19's impact on crude oil and natural gas S&P GS Indexes," Working Papers halshs-02613280, HAL.
    2. Frondel Manuel & Hansteen Sven & Krieg Marielena & Schmidt Christoph M., 2023. "Deutschlands Energieversorgungsrisiko vor Russlands Angriff auf die Ukraine: Ein empirischer Vergleich mit den G7-Staaten," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 24(2), pages 233-246, June.
    3. Xing, Li-Min & Zhang, Yue-Jun, 2022. "Forecasting crude oil prices with shrinkage methods: Can nonconvex penalty and Huber loss help?," Energy Economics, Elsevier, vol. 110(C).
    4. Quint, Dominic & Venditti, Fabrizio, 2020. "The influence of OPEC+ on oil prices: a quantitative assessment," Working Paper Series 2467, European Central Bank.
    5. Kisswani, Khalid M. & Lahiani, Amine & Mefteh-Wali, Salma, 2022. "An analysis of OPEC oil production reaction to non-OPEC oil supply," Resources Policy, Elsevier, vol. 77(C).

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