Now, here is the real story of Russia – Ukraine war.
It could be said the battle of Russia and the US for natural gas. Natural gas is precisely the fundamental reason for the war between Russia and Ukraine.
Russia-US natural gas conflict has been escalating since the early 2000. Because the Russian energy industry had become too large.
Russia is a major energy superpower, with vast reserves of crude oil, natural gas, and coal. These resources are essential for modern life. The energy industry is experiencing a significant growth, driven by rising demand in recent years.
Russia, which has increased its financial resources through the energy industry, has rapidly strengthened its military power. It has become bigger threat to the United States than ever before.
The US would not give up its position, but to stop Russia to grow. Let’ see how powerful Russia’s energy is.
Contents
Oil production in Russia
Russia is one of the world’s top three crude oil producers, along with the United States and Saudi Arabia. Before shale gas & oil revolution of the U.S. 2011-2013, Russia and Saudi Arabia had dominated oil fields. The U.S produced relatively small amount, was major importer in OPEC and Persian regions.
Top 3 oil producers by output
Shale gas & oil revolution changed US’s position dramatically in the energy fields. As well as dependence toward middle east, OPEC countries.
In 2005, crude oil import of the U.S was peaked 3,696 million barrels. Then it reduced 2,680 million barrels in 2015. That was only 2,150 million at the covid-19 pandemic.
Shale Oil Production Growth in the U.S
Success of the US energy production by shale technology made a huge economical profit.
What is shale Boom?
The U.S. shale boom—a product of technological advances in horizontal drilling and hydraulic fracturing that unlocked new stores of energy—has benefited the nation’s oil trade balance and oil-producing regions and led to unusually large employment and output gains.
As the consequence of shale technology, United States become one of major energy producers. In 2017, US ranked in top of the world, as beating Russia and Saudi Arabia.
the U.S. imports of crude oil – eia
Although renewable energy is on the rise, still fossil fuels remain as important resources. To control world trading with highest position, the energy can be most powerful tools of global economics and politics.
The United States was keen to maintain its highest position, to be dominant player in this field. However, there are always Russia and Saudi Arabia, and other oil-producing countries to consider. Those rival countries are always causing the United States to feel uneasy. Russia has a particularly strong capacity for oil and gas production, as well as a growing financial ability and military strength. It is therefore imperative, that the particular action must be taken.
The World’s Biggest Oil Producers
When the price disruption occurred to oil in 2016, The former president Barrack Obama requested Saudi Arabia, Russia and other prominent members to reduce production in order to stabilize the price.
But how ironical, meanwhile the US increased shale oil production instead of decrease, became top exporter of its oil productions in 2017 first time.
The U.S. Just Became a Net Oil Exporter for the First Time in 75 Years – bloomberg
It has been as if “only United State should be the top oil producer,” that kind of mood were accepted through in the energy fields.
In maintaining its own position, the US has a history of exerting pressure on rivals to control production, particularly those such as Saudi Arabia and Russia who may present obstacles to its dominance.
Unlike net data of oil productions, name of countries varies on its real capabilities of reserved oil.
Oil reserve by country
Venezuela comes top of 303 barrels, then Saudi, Iran, Canada, Iraq.
At the notable fact, 5 countries of top 10 countries are facing the US sanctions.
Russia is 80 barrels, that advanced from United State of 56 billion barrels. Russia and other top oil reserve countries would anytime soon surpass the US, if there was no sanctions.
Furthermore Russia has a new discovery of vast scale of gas and oil in Antarctica British territory. Its reserves contain about 511 billion barrels of oil, estimated as almost 10 times of the North Sea’s output over the last 50 years.
That seems to be added oil into fire, so the US had to tighten its grip with the UK. To make sure that Russia will not be succeed from it.
U.S. Crude Oil and Natural Gas Proved Reserves – eia
Oil Reserves by Country 2024 – world population review
OPEC Share of World Crude Oil Reserve 2023 – OPEC
Natural Gas Production in Russia
Oil capacity of Russia threats the US, but is not as significant as Russian natural gas to be.
Russia’s natural gas resources are enormous, with sustainable future ahead.
Only to look at the potential is enough. The US must be mindful of the possibility that Russia could eventually surpass the US in this sector. The Biden administration needed take the initiative to make changes.
World’s top exporter of natural gas
Main players of natural gas export are, United States, Russia, Qatar, Norway, Australia, Canada, Algeria, Malaysia, Nigeria, Iran.
Since the 1900s, the United States has been the dominant producer of natural gas on a global scale. Then following the 1980s, the Soviet Union (Russia) initiated a significant expansion in gas development throughout Eastern Europe, establishing itself as only a formidable competitor in the global gas production landscape.
Gas production by countries 1940-2023
Acording to the data, Russia has actually surppased the US gas production during 1985-2009.
Gas production – United States and Russia (1985-2021)
In the aftermath of the global financial crisis of 2008, the United States demonstrated resilience in its economic recovery. However, Russia remained in a relatively close position to the United States. Subsequently, Russia achieved the highest recorded level of gas production in 2021, which was shortly before the invasion of Ukraine.
Natural Gas Reserves Russia US
To see natural gas reserves by county, no countries can compete, not even close to Russia. Russia has a vast natural gas reserves at high level. That is the most substantial in the world, exceeding those of competing countries by a considerable margin.
This fact indicates the potential to challenge the United States in its role as a global leader.
It is understandable that there is a certain level of apprehension given the recent global trade conditions in the United States. How could it be if the Western countries did not impose sanctions to Russia by the reason of Ukraine.
US trade deficit 2015-2024
To the fact, trade deficit of the United states were increased dramatically since 2020. The amount of the trade deficit was $681.7 billion in 2020, following year, increased as $845.0 billions. To the worse that reached $1.20 trillion in 2022.
It would therefore be beneficial for the US to consider ways of sanctions for their export capacity.
CIA The World factbook Natural Production (2004)
The US surpassed Russia as world’s leading producer of dry natural gas in 2009 and 2010 – eia
2020 Trade Gap – Bureau of economic analysis
Natural Gas Export 2020～2023
Russia was the largest exporter of natural gas in 2020, with 238.1 billion cubic metres of gas exported. The second largest exporter was the United States, with 76.1 billion cubic metres of pipeline exports and 61.4 billion cubic metres of LNG exports. Other large exporters are Qatar, Norway, and Australia.
Natural Gas Export By Country 2020
To improve the trade balance, simply need to reduce the imports and increase the value of exports. To increase exports, U.S. shale gas and shale oil, which are worth more than 150 billion US dollars, are important earners.
Natural Gas Export by Country 2023
The year of 2022, US oil and gas had revenue peaked at $330.8 billion. In 2023, its revenue decreased but $244 billions.
The “invasion of Ukraine + economic sanctions against Russia” worked well, suppressed Russian gas exports, and the US came up the top exporter in 2023.
Unlike other fossil fuels, Natural gas has ability to get along with green energy movement. Reducing CO2 and comparatively inexpensive for mega use, such as data center.
Unfortunately, Sakhalin2, Yamal, Arctic LNG, most of Russian gas & oil project are facing difficulty by sanctions at this moment. That is causing supply difficulty and inflation.
While conventional gas production peaked thanks to shale in 1973, by 2009 the U.S. had surpassed Russia as the world’s biggest gas producer. In 2023 it became the largest liquefied natural gas (LNG) exporter in the world, outgrowing Qatar and Australia – two giants of the industry.
That was sanctions to help the US as top exporter of LNG in 2023. Indeed that was what seriously the US needed. Russia’s vast scale of gas project could be nightmare for the US.
That is why Russia had to play critically evil part at the world stage. To adjust sanction reasonable and rightful, Ukraine was only a suitable position to use. In addition, it was just the right moment to interfere, to reduce Russia’s growing power through Ukraine.
Other Resources in Russia
As observed so far, it is no secret that Russia and the United States are engaged in a fierce competition to energy resources. Coal is no exception.
Coal Exporter in the world 2023
In terms of coal production, Indonesia is the top country, with Russia in second place and the United States in third.
To see reserves, the United States ranks first and Russia ranks second.
However, demand is expected to decline in the long term due to decarbonization. It is fate, the United States and Russia are always facing as rivals at many fields.
Energy-related resource in Russia
Furthermore, Russia has a significant market presence in silicon, sulfur, gold, platinum, and palladium…. so on. These are essential for the development of renewable energy and batteries.
Russia’s total natural resource value in 2024, is estimated at $100 trillion, representing a figure that is almost twice of the United States.
This is also a cause of concerning for the United States.
The relationship between the US and Russia is dependent on the political leadership in both countries and the prevailing circumstances. Since Russia’s annexation of Crimea in 2014 and the subsequent election of President Biden, relations between the United States and Russia have visibly deteriorated.
Especially enmity of both countries are crucial to gas pipeline.
Total value of Russia’s natural resources estimated at $100 trillion – Emirate News Agency
