Geopolitical impact of the development of unconventional hydrocarbons

Unconventional oil and gas resources are abundant and their production is economically viable. In addition, the geographical distribution of these resources helps to diversify the traditional sources of supply currently highly concentrated in the Middle East and Russia. Stagnation and imminent fall in production of crude oil will make unconventional oil to gain prominence in the future. Over the next decade, its increasing extraction, particularly in the United States and Canada, will help to temporarily weaken the hegemony of the OPEC which nevertheless will regain control of the market shortly after the mid-1920s. Meanwhile, the production of unconventional gas will extend in the future from North America to other parts of the world, consolidating its contribution to the global supply of gas on a long-term basis. The change in the geography of demand, whose centre is moving towards Asia, along with the changes introduced by the unconventional hydrocarbons production in the current balance between exporting and importing countries, will incur a reorganization of the trade flows of oil and natural gas, with implications upon the security of the global supply routes. The United States, which thanks to unconventional oil, achieves the auto-sufficiency in the case of natural gas as well as a low degree of dependence on crude oil imports, is the big beneficiary in the medium term of the so-called unconventional revolution. The European Union, by contrast, will see an increase on its imports and external dependence.