Fracking - - Mitigated Disaster?

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Wednesday September 16, 2015 · 12:51 PM PDT

2015/09/16 · 12:51

President Obama has supported fracking, a method which has produced spills, earthquakes, and water contamination -- also cheap, domestic oil and natural gas. Did he know what he was doing?

Fracking has proven itself. The environmental impacts and the reaction against them are building up. However, the hydrocarbons produced are having an interesting effect on world energy prices.

Massey coal is facing bankruptcy since almost no power plants burn coal anymore. Their coal reserves have been devalued to less than one tenth of what they were only two years ago. Banks which accepted reserves as collateral on loans are sweating bullets. With dropping prices, nearly half the frackers in North Dakota are in the same jam as coal producers and are shutting down. Saudi Arabia is playing hardball, trying to regain control, and flooding the market, driving other producers toward ruin.

What is going on here?

If we subtract the obvious pushing and shoving, the central cause is unrestrained production of oil and gas causing markets to be disrupted. Fracking is the tip of that spear, and the chaos it unleashed will continue for some time. Just as important, each year alternative energy sources are becoming cheaper and more attractive, putting more pressure on hydrocarbon use. What could this all lead to?

I don't think anyone could accurately predict the future here, but the trends are clear. The petrochemical industry had planned to squeeze the last dollar out of the last barrel of oil at high profit margins, and as market trends continue they may not be able to sell their product at all. The recent price disruptions have perhaps upset their plans fatally. Fracking, despite the perhaps short term abundance it has produced, may ultimately be denounced and banned due to unacceptable environmental impacts, having spawned the forces which dragged all other producers down.

This could leave a clean playing field for alternative energy sources.

Did Obama know what he was doing? Personally, I think we have underestimated this man consistently. I think he is thinking so far outside of the box that there are no boxes where he lives. I think that his love of this country, persistence, and cleverness will leave us a legacy second only to that of FDR. But. . .

Time will tell.

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