Cheap, Abundant Natural Gas Is a Game Changer, Says the IMF

Article excerpt

Expressing surprise at the enormous increase in U.S. production of oil and natural gas by unconventional means, Thomas Helbling, a division chief in the IMF's (International Monetary Fund) Research Department, was forced to admit that it was free enterprise that was responsible for it after all. In the IMF's March 2013 Finance and Development report, he wrote:

  A strong rebound in gas and then oil production in the United States
  over the past few years has taken markets and policymakers by
  surprise. ... As a result, natural gas prices in the United
  States are at a 20-year low.

It's all because of fracking and free enterprise, which have "fundamentally changed the outlook for natural gas as a source of energy," he added. This illustrates the phenomenon known in Economics 101 as "the law of supply and demand."

The increase in the production of natural gas in the United States over the past several years has been impressive, with output rising 30 percent between 2008 and 2012, with no end in sight. At present, the Energy Information Administration (EIA) estimates that recoverable natural gas now exceeds 750 trillion cubic feet, about 30 years of total annual production of natural gas. …