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The U.S. fracking boom: Impact on oil prices

Author

Listed:
  • Frondel, Manuel
  • Horvath, Marco

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

  • Frondel, Manuel & Horvath, Marco, 2019. "The U.S. fracking boom: Impact on oil prices," Ruhr Economic Papers 794, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    • Handle: RePEc:zbw:rwirep:794
    DOI: 10.4419/86788922
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    References listed on IDEAS

    as
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    Citations

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    Cited by:

    1. 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).
    2. 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).
    3. 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.
    4. Lindequist, David & Selent, Samuel, 2025. "Did shale gas green the U.S. economy?," Energy Economics, Elsevier, vol. 145(C).
    5. Dominic Quint & Fabrizio Venditti, 2023. "The Influence of OPEC+ on Oil Prices: A Quantitative Assessment," The Energy Journal, , vol. 44(5), pages 173-186, September.
    6. Hannah Z. Hendricks & Elizabeth Long-Meek & Haylie M. June & Ashley R. Kernan & Michael R. Cope, 2025. "Social Impacts of Shale Oil Extraction: A Multidisciplinary Review of Community and Institutional Change," Social Sciences, MDPI, vol. 14(8), pages 1-23, August.
    7. 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.

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    Keywords

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    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • L71 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Mining, Extraction, and Refining: Hydrocarbon Fuels

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