An interesting read from Oilprice.com
The shale boom in the US has shifted the dynamics of electricity generation to natural gas from coal. As such the US now exports nearly 90% of the coal it mined for electricity with Europe, China and Japan the main buyers. This has brought global prices down which is good news for high energy importing countries such as the UK.
It further highlights the fact that the US is on track to become a net exporter of energy in the not too distant future.
I’ve long said that the high prices of energy importing has been one of sticking points to a recovery in the UK and Europe. It accounts for a large part of inflation and also in keeping production prices high while depressing margins.
If energy prices start coming down significantly then we will that trend reverse and our economies will benefit from it.
As for the US, well, becoming exporters of energy should lower global prices by adding more supply but it will also mean a bonanza to the country’s finances at a time it’s really needed.
It’s just another piece of the puzzle that we need to keep an eye on.
The full story from Oilprice.com can be read here.
