Higher Oil prices drove increased profits for US Oil giant ExxonMobil, but the earnings report yesterday missed analyst expectations due to natural gas outages and refining downtime.
Net income jumped 18% in the second quarter to $4bn compared to the same period a year earlier.
That translated into 92 cents a share, well below the $1.27 expected by analysts. Revenues rose 26.6% to $73.5bn, the company announced.
The results follow jumps in profits for Royal Dutch Shell and Total reported on Thursday and illustrate the bounce from oil prices.
Crude mostly traded in a range of $65 to $75 a barrel during the quarter, up from the $45 to $50 range in the year-ago period.
But ExxonMobil reported another significant slide in oil and gas production, which dipped 7% to 3.6mn barrels a day of oil-equivalent. The company said natural gas output was especially weak, diving 10%.
Downtime in refining also hit results, due mostly to an unusually high number of planned refining outages at various plants and some unplanned maintenance following incidents at facilities in the first quarter, the company said. ExxonMobil shares slumped 4.0% to $80.84 in pre-market trading.

Chevron
US oil and natural gas producer Chevron Corp posted a lower-than-expected quarterly profit yesterday and executives launched a long-awaited $3bn share buyback programme.
Shares of the San Ramon, California-based company fell 2.4% to $121 in pre-market trading.
The company posted second-quarter net income of $3.41bn, or $1.78 per share, compared to $1.45bn, or 77 cents per share, in the year-ago quarter.
Analysts expected earnings of $2.09 per share, according to Thomson Reuters I/B/E/S. Chevron’s expenses rose about 15% during the quarter to $37.33bn.
Production rose about 2% to 2.83mn barrels of oil equivalent per day. “Results in 2018 benefited from higher crude oil prices, strong operations and higher production,” chief executive Mike Wirth said in a press release.

Catholics can now listen to Pope Francis’ speeches live in five languages following the launch of a new smartphone app, the Vatican announced on Friday.

Vatican Audio translates Francis, who usually addresses the faithful in Italian, into Spanish, English, French, German and Portuguese, also offering Italian when he speaks in his native Spanish.

A Vatican spokesperson told AFP that the app will work for the pope’s Angelus speech this Sunday, finally enabling the thousands of people who will flock to St. Peter’s Square from around the world to understand the pontiff.

Vatican Audio will also work on Tuesday, when Francis will meet 60,000 altar boys and girls — mainly teenagers — taking part in a week-long pilgrimage to Rome from over a dozen countries. (AFP)

July 27 (Reuters) – Asian spot liquefied natural gas (LNG) prices rose this week as a heatwave gripped Japan and high temperatures swept across South Korea and parts of China boosting cooling demand though relief is set to come from new Russian supplies.

Spot prices for September LNG-AS delivery in Asia were assessed at $9.75 per million British thermal units (Btu), up 25 cents from the previous week.

Contrary to previous forecasts, temperatures in Japan stayed above average in a prolonged heatwave that killed dozens of people. It also prompted electric utilities to fire up mothballed oil and gas-fired power plants left on standby.

The heat hit South Korea too but any increase in gas demand may be muted by the start-up of the 950-megawatt Hanul No.2 nuclear reactor, which is expected to by fully operational by Sunday.

LNG imports into South Korea hit record levels in the first half of the year but such volumes will not be sustainable as anticipated nuclear start-ups will leave an average of only six reactors offline over the rest of the year.

The second train at Novatek’s Arctic Russian operations in Yamal has started operations, one trader said. Novatek said last year that the second train would start operations in the third quarter of this year.

“The start of Yamal’s Train 2 is easing the pain for buyers but demand due to the heatwave seems to be picking up,” said one trader.

Papua New Guinea launched a tender offering a cargo for Aug. 22-29 and the bids were seen to be bullish although the result is not yet known, the trader said.

However, Russia’s Sakhalin II cargo offered in the first half of September was sold to a shareholder of the plant for an estimated $9.70 per mmBtu. Another trader cited a potential transaction range of $9.65-$9.70 per mmBtu.

He sees September prices around the $9.75 per mmBtu mark.

Aside from Yamal, traders were also waiting on new supplies from Japan’s Inpex, which expects its Ichthys plant in Australia to start up in September.

European spot prices so far remain uncompetitive with Asia in drawing away Qatari cargoes, as storage inventories recover across the continent. (Reporting by Sabina Zawadzki in LONDON, editing by David Evans)

US hopes to defuse simmering dispute between Qatar and other key states in the region

Donald Trump’s advisers are hoping to call the leaders of the Gulf states to a summit in Washington this Autumn, despite Saudi Arabia and the United Arab Emirates’ insistence that they will not drop their demand for Qatar to cease its disruption across the region.

Key figures in the alliance of four Gulf states boycotting Qatar are wary of the Trump summit agenda, but say privately they are willing in principle to attend.

Qatar has been pressing for months for a summit, believing there can be no progress in the Gulf dispute without the involvement of the US. It has lobbied the US to acknowledge that the year-long collapse in Gulf unity is damaging to US interests. It also claims US reliance on a reckless Saudi foreign policy could lead to chaos in Iran and the energy markets, paralysis in Yemen and extended proxy conflicts in the Horn of Africa and Libya.

WASHINGTON — For years, President Trump has used Twitter as his go-to public relations weapon, mounting a barrage of attacks on celebrities and then political rivals even after advisers warned he could be creating legal problems for himself.

Those concerns now turn out to be well founded. The special counsel, Robert S. Mueller III, is scrutinizing tweets and negative statements from the president about Attorney General Jeff Sessions and the former F.B.I. director James B. Comey, according to three people briefed on the matter.

Several of the remarks came as Mr. Trump was also privately pressuring the men — both key witnesses in the inquiry — about the investigation, and Mr. Mueller is examining whether the actions add up to attempts to obstruct the investigation by both intimidating witnesses and pressuring senior law enforcement officials to tamp down the inquiry.

Mr. Mueller wants to question the president about the tweets. His interest in them is the latest addition to a range of presidential actions he is investigating as a possible obstruction case: private interactions with Mr. Comey, Mr. Sessions and other senior administration officials about the Russia inquiry; misleading White House statements; public attacks; and possible pardon offers to potential witnesses.

None of what Mr. Mueller has homed in on constitutes obstruction, Mr. Trump’s lawyers said. They argued that most of the presidential acts under scrutiny, including the firing of Mr. Comey, fall under Mr. Trump’s authority as the head of the executive branch and insisted that he should not even have to answer Mr. Mueller’s questions about obstruction.

But privately, some of the lawyers have expressed concern that Mr. Mueller will stitch together several episodes, encounters and pieces of evidence, like the tweets, to build a case that the president embarked on a broad effort to interfere with the investigation. Prosecutors who lack one slam-dunk piece of evidence in obstruction cases often search for a larger pattern of behavior, legal experts said.

The special counsel’s investigators have told Mr. Trump’s lawyers they are examining the tweets under a wide-ranging obstruction-of-justice law beefed up after the Enron accounting scandal, according to the three people. The investigators did not explicitly say they were examining possible witness tampering, but the nature of the questions they want to ask the president, and the fact that they are scrutinizing his actions under a section of the United States Code titled “Tampering With a Witness, Victim, or an Informant,” raised concerns for his lawyers about Mr. Trump’s exposure in the investigation.

A spokesman for Mr. Mueller’s office declined to comment.

Mr. Trump’s lead lawyer in the case, Rudolph W. Giuliani, dismissed Mr. Mueller’s interest in the tweets as part of a desperate quest to sink the president.

“If you’re going to obstruct justice, you do it quietly and secretly, not in public,” Mr. Giuliani said.

Mr. Giuliani was referring to more typical obstruction cases, where prosecutors focus on measures taken in private, like bribing witnesses, destroying evidence or lying under oath. While some of Mr. Trump’s private acts are under scrutiny, like asking Mr. Comey for loyalty, his public conduct is as well. That sets this investigation apart, even from those of other presidents; Richard M. Nixon and Bill Clinton were accused of privately trying to influence witness testimony.

But as in those cases, federal investigators are seeking to determine whether Mr. Trump was trying to use his power to punish anyone who did not go along with his attempts to curtail the investigation.

If Mr. Mueller opts to tailor a narrative that the president tried to obstruct the Russia investigation, he would have to clear several hurdles to make a strong case. He would need credible witnesses (Mr. Comey and Mr. Sessions have been the target of concerted attacks by Mr. Trump and allies, undercutting their standing) and evidence that Mr. Trump had criminal intent (the special counsel has told the president’s lawyers he needs to question him to determine this).

“There’s rarely evidence that someone sits down and says, ‘I intend to commit a crime,’ so any type of investigation hangs on using additional evidence to build a narrative arc that hangs together,” said Samuel W. Buell, a professor of law at Duke University and former senior federal prosecutor. “That’s why a prosecutor wants more pieces of evidence. You need to lock down the argument.”

It is not clear what Mr. Mueller will do if he concludes he has enough evidence to prove that Mr. Trump committed a crime. He has told the president’s lawyers that he will follow Nixon- and Clinton-era Justice Department memos that concluded that a sitting president cannot be indicted, Mr. Giuliani has said. If Mr. Mueller does not plan to make a case in court, a report of his findings could be sent to Congress, leaving it to lawmakers to decide whether to begin impeachment proceedings.

Investigators want to ask Mr. Trump about the tweets he wrote about Mr. Sessions and Mr. Comey and why he has continued to publicly criticize Mr. Comey and the former deputy F.B.I. director Andrew G. McCabe, another witness against the president. They also want to know about a January episode in the Oval Office in which Mr. Trump asked the White House counsel, Donald F. McGahn II, about reports that Mr. McGahn told investigators about the president’s efforts to fire Mr. Mueller himself last year.

Mr. Trump has navigated the investigation with a mix of public and private cajoling of witnesses.

Around the time he said publicly last summer that he would have chosen another attorney general had he known Mr. Sessions was going to recuse himself from the Russia investigation, Mr. Trump tried behind closed doors to persuade Mr. Sessions to reverse that decision. The special counsel’s investigators have also learned that Mr. Trump wanted Mr. Sessions to resign at varying points in May and July 2017 so he could replace him with a loyalist to oversee the Russia investigation.

After Mr. Trump tried last July to get Mr. Sessions to resign, the president began a three-day public attack on a variety of fronts — tweets, a Rose Garden news conference and a Wall Street Journal interview — criticizing Mr. Sessions, raising the specter that he would fire him.

Similarly, Mr. Trump’s relationship with Mr. Comey was strained from the start by the president’s encroachment on the typically independent Justice Department. In late March of 2017, the president asked Mr. Comey to put out word that he was not under investigation. Mr. Comey demurred, and when the president called about two weeks later to ask again, Mr. Comey responded that he had passed along the proposal to the Justice Department, he later testified.

That request having gone nowhere, Mr. Trump issued an indirect threat the next day about Mr. Comey’s job. “It’s not too late” to ask him to step down as F.B.I. director, he said in an interview with Maria Bartiromo on Fox Business Network. The special counsel wants to ask the president what he meant by that remark.

A few weeks later, in early May, an aide to Mr. Sessions sought derogatory information about the F.B.I. director. Mr. Sessions, his aide told a Capitol Hill staff member, wanted one negative article a day in the news media about Mr. Comey, a person familiar with the meeting has said.

Four days later, Mr. Trump fired Mr. Comey, citing at first his management of the investigation of Hillary Clinton’s use of a private email server to handle classified information.

By the fall, Mr. Comey had become a chief witness against the president in the special counsel investigation, and Mr. Trump’s ire toward him was well established. His personal attacks evolved into attacks on Mr. Comey’s work, publicly calling on the Justice Department to examine his handling of the Clinton inquiry — and drawing the special counsel’s interest.

Mr. Mueller’s deputies told Mr. Trump’s lawyers they also wanted to question the president about similar statements at the time by the White House press secretary, Sarah Huckabee Sanders.

“The Department of Justice has to look into any allegations of whether or not something is illegal or not,” Ms. Sanders said at a press briefing last September. “That’s not up to me to decide. What I’ve said and what I’m talking about are facts. James Comey — leaking of information, questionable statements under oath, politicizing an investigation — those are real reasons for why he was fired.”

Mr. Trump’s lawyers have pushed back against the special counsel about the tweets, saying the president is a politician under 24-hour attack and is within his rights to defend himself using social media or any other means.

The president continues to wield his Twitter account to pummel witnesses and the investigation itself, ignoring any legal concerns or accusations of witness intimidation. This week, he moved to strip the security clearances of six former senior national security officials, including Mr. Comey, Mr. McCabe and some of his most outspoken critics. And he tweeted false claims about the Russia investigation.

By now, the story of how Russia used fake news to push its own agenda in the United States is well known.

But it’s not just Kremlin-produced disinformation that Americans may have stumbled upon recently. Browsing Facebook and Twitter — and even just perusing the magazine rack at their local Walmart — they may have also been exposed to propaganda supporting the ambitious goals of two oil-rich Arab Gulf countries.

Saudi Arabia and the United Arab Emirates have long spent huge sums of money on Washington lobbyists and public relations firms to win favor with those in power in the United States and those who influence them. But when Saudi Arabia and the UAE launched a boycott and blockade of the tiny peninsula state of Qatar last year, organizations with ties to Riyadh and Abu Dhabii tried something new: They worked to sway American public opinion through online and social media campaigns, bringing a complicated, distant conflict among three Washington allies to US shores.

The Gulf crisis began in June 2017 when Saudi Arabia and the UAE led other Arab countries in cutting diplomatic relations with Qatar. They accused Qatar of supporting terrorism and destabilizing the region, a charge Doha rejects. After initiating an economic blockade, the boycotting countries issued a list of 13 demands for Qatar to meet, including aligning foreign policy with theirs, ending support for the Muslim Brotherhood, shuttering the satellite news channel Al Jazeera and cutting ties with Iran.

As they took steps against Doha, Saudi Arabia and the UAE also initiated propaganda efforts in the US aimed at weakening Washington’s alliance with Qatar — which hosts the largest American military base in the Middle East — while also enhancing their own images.

Take, for example, The Qatar Insider.

The anti-Qatar website went live last year, advertising itself as “your comprehensive source for information on #QatarCrisis.” It pushed a steady stream of clickbait-style disinformation, often relying on catchy, misleading infographics to try to draw in an audience.

It wasn’t an ordinary news outlet. The Saudi American Public Relation Affairs Committee (SAPRAC), a pro-Saudi lobby group not officially tied to the Saudi government, paid $2.6 million last year to the now-defunct, Washington-based lobbying firm the Podesta Group for public affairs services that included running the anti-Qatar website and its associated social media properties.

Among The Qatar Insider’s claims were that Qatar had spent a whopping $64.2 billion on supporting terrorism between 2010 and 2015 (citing the “US Treasury” as a source); that Qatar not only supports ISIS, but trained its fighters; that al-Qaeda’s 9/11 mastermind Khalid Sheikh Mohammed (who is imprisoned at Guantanamo Bay) is being “sheltered” by Qatar; that the Qatari state has openly threatened to carry out genocide on its people to quiet dissent; and that in preparing for the 2022 World Cup, Qatar has bankrolled Pyongyang’s dictatorship and nuclear program by allowing North Korean workers to work on World Cup infrastructure projects.

TV ads aired in the US by the Podesta Group that advertised The Qatar Insider were identified to viewers as “distributed by SAPRAC” and “sponsored by the embassy of Bahrain,” a close Saudi ally that was involved in funding SAPRAC. But The Qatar Insider’s website made no mention of the Podesta Group, SAPRAC or the Saudi or Bahraini governments. It was laid out like a news site, with its “about us” section describing it as “the comprehensive source for information on the truth about Qatar’s funding, activities and support for terrorist and extreme Islamist groups.”

In its contract with the SAPRAC, the Podesta Group wrote that their online campaign would target “low-hanging fruit,” which they described as users who were actively seeking information about Saudi Arabia and Qatar. The goal was to ensure “that they see the content we want them to see at the top of their search results.”

Along with painting Qatar as a terror-friendly nation, The Qatar Insider encouraged the US to remove its Al Udeid Air Base, which is home to the forward headquarters of the US Central Command, from Qatar and lobbied against Qatar hosting the 2022 World Cup.

SCL Social Limited, which is owned by the same parent company as Cambridge Analytica, took an approach similar to the Podesta Group when it was awarded a $333,000 contract for social media outreach on behalf of the UAE’s government.

Last September, the company spent more than $60,000 on ads on Facebook, YouTube, Twitter and other online platforms to promote the #BoycottQatar hashtag and link to a mix of articles critical of Qatar alongside disinformation.

Their ads were blunt and focused on Americans: “Trump: Qatar engaged in terrorism-related activity,” read one.

Most of the posts on their Boycott Qatar Facebook and Twitter pages have disappeared, but documents supplied to the Department of Justice show that they frequently linked to The Qatar Insider while also pointing users to articles critical of Doha in more credible publications.

Efforts have not been limited to simple meme-formatted clickbait and ads on social media.

Last fall, a film billed as an “educational documentary” called “Qatar: A Dangerous Alliance” appeared online and was distributed to guests at an event hosted by the conservative Hudson Institute that featured Steve Bannon, a former senior adviser to President Donald Trump and the ex-chairman of Breitbart News.

The film had a clear anti-Qatar bent, but it was presented as an American production. But documents filed to the Department of Justice in recent months show that the film was made by two US companies paid by Lapis Middle East and North Africa, a Dubai-based communications firm that has worked for the UAE’s government. One of those companies, Andreae & Associates, is headed by Charles Andreae, a former CEO of Bell Pottinger, which produced fake Iraqi insurgent videos as part of US government propaganda push during his time with the company. Andreae & Associates was paid $565,000 for their role in the anti-Qatar documentary. Videos uploaded to the film’s YouTube channel has counted nearly one million views.

And when Saudi Arabia’s de facto ruler, Crown Prince Mohammed bin Salman, visited the US in March, a magazine bearing his face and celebrating his reign appeared at 200,000 outlets across the country. The Saudi Embassy denied knowledge of the magazine, and the company that published it, National Enquirer publisher American Media Inc., denied receiving guidance from the Saudis.

Citing employees of American Media Inc, The New York Times later reported that the magazine was an attempt by the publisher’s CEO to win business in Saudi Arabia. Still, there was evidencethat the Saudi Embassy and advisers to the Saudi royal family had received advanced copies of the publication, hinting that they were involved in its creation and fawning tone.

These attempts to woo the American public came even as the Saudis and Emiratis had access to the highest levels of power in the US — as well as the ability to influence Washington’s Gulf policy.

Seeing Trump’s hostility toward Iran mirroring their own, Saudi Arabia and the UAE were eager to strengthen their relationship with the former reality TV host when he took office, despite his harsh campaign-trail criticisms of Islam and Saudis (who, he once said, “want women as slaves and to kill gays”). In May, The New York Times reported that an emissary of Saudi Arabia’s Crown Prince Mohammed and the crown prince of Abu Dhabi, Mohammed bin Zayed, held a meeting with Donald Trump Jr. ahead of the 2016 elections offering their support to Trump as well as social media help in winning the election.

The early outreach attempts seemed to work: Trump’s first international trip as president, in May 2017, was to Saudi Arabia, where he signed a $110 billion arms deal. And when the Qatar crisis broke out the next month, Trump quickly expressed support for Riyadh and Abu Dhabi and accused Qatar of supporting terror.

“I think the Saudis and Emiratis very quickly grasped that they had pretty much a clean slate to try to paint — and I think that’s exactly what they tried to do,” said Kristian Ulrichsen, a Gulf expert at the Baker Institute for Public Policy at Rice University.

But Ulrichsen questions how effective the broader propaganda efforts have been.

“Very few of these moves — to target Facebook, Twitter, to make videos that very few people watch — would have any impact on shaping public opinion,” he said. “In terms of the Gulf crisis … very few people [in the US] actually think about it at all.”

Sigurd Neubauer, a Washington-based Middle East analyst, agreed.

“If you asked the average American about the Gulf and they see these commercials, they will not be able to tell the difference,” he said. “And for those who do know the difference, they will remember that Saudi Arabia, not Qatar, had its citizens participating in the 9/11 attacks.”

While Qatar has not apparently engaged in the kind of propaganda war that groups linked to Saudi Arabia and the UAE have in the US, it has not sat idle. Qatar — or, at best, its friends — has been involved in the hacking and leaking of emails designed to embarrass the UAE and reveal its role in trying to influence the Trump campaign. Qatar has increased its spending on lobbyists while also trying to soften its image by wooing American Jewish groups, including the Zionist Organization of America, which previously called for Qatar to be listed as a state sponsor of terrorism. And in May, Qatar flexed its soft power muscles when it offered to pay to keep the Washington, DC, metro open after a Capitals playoff game.

Over time, Trump softened his tone on Qatar, and now again hails them as an ally against terrorism. The situation remains delicate, but the US is once again on a friendly footing with all three allies, even as their own feud continues and Saudi Arabia threatens to turn Qatar into an island.

But to Neubauer, the Gulf crisis has left all parties involved looking bad.

“Instead of saying one country is better than the other, everyone looks really, really horrible,” he said. “It really raises questions about what kind of partners these countries are for the United States.”

(Reuters) – The United Arab Emirates (UAE) denied reports on Thursday that Yemen’s Iranian-aligned Houthi movement had attacked Abu Dhabi airport with a drone, and said operations were unaffected.

Houthi-run media said earlier that a Sammad-3 drone had launched three strikes on the facility, disrupting air traffic, but did not provide any evidence and there were no reports of damage or casualties.

“Operations at the airport are business as usual,” a UAE official told Reuters.

The Houthis attacked two tankers in the Bab al-Mandeb strait a day earlier, prompting Saudi Arabia to suspend oil shipments through the strategic Red Sea lane.

The Houthis control much of northern Yemen and have said Abu Dhabi, a member of the Western-backed coalition fighting against them since 2015, was a target for their missiles.

The UAE has an advanced anti-missile interception system – the Theater High Altitude Area Defense (THAAD) which is designed to destroy short- and intermediate-range missiles both inside and outside the Earth’s atmosphere.

Abu Dhabi airport tweeted earlier in the day that there had been an incident involving a supply vehicle which had not affected operations, but it was unclear if it was referring to the same incident.

In December last year, the Houthis said they fired a cruise missile toward a nuclear power plant in Abu Dhabi.

With non-oil growth expected to taper as the government’s investment programme reaches an advanced phase, Qatar has turned back to gas/liquefied natural gas (LNG) production as it intends to maintain its position as the world’s largest LNG producer, according to NBK.

Non-oil growth is expected to taper with the government’s investment programme reaching an advanced phase; only four years remain for many of the high-profile infrastructure projects, such as the metro, light rail system and stadia, to be completed in time for the 2022 FIFA World Cup, it said in a report.
The $7.4bn Hamad Port, which Qatar plans to develop into a regional transport hub and with which Doha hopes to bypass trade sanctions, was officially inaugurated at the end of 2017, leaving only a handful of projects left for the authorities to eke out future output gains, it said.
“Attention, therefore, has turned back to gas/LNG production,” NBK said, adding in the short term, the delayed 1.4bn cubic feet per day Barzan gas facility should finally come on line in the fourth quarter of 2018, supplying additional volumes of gas and condensates; while in the medium term, Qatar’s intention to expand liquefaction capacity by 30% to 100mn tonnes per annum will significantly boost growth in the hydrocarbon sector.
Qatar’s economic growth is expected to edge up slightly in 2018 to 1.7%, following last year’s growth of 1.5%, before accelerating to 2.2% in 2019.
The economic activity will benefit from output gains in both the hydrocarbon (+0.3%) and non-hydrocarbon sectors (+3.3%), with the former witnessing an expansion in crude and LNG production and the latter benefitting from the government’s $200bn infrastructure spending programme.
Qatar’s public finances appear to be on a sound footing following the government’s fiscal consolidation efforts (cuts to subsidies, merging of ministries etc.), which brought public expenditures down by 12% in 2017, and the rise in oil and gas prices, it said.
“The fiscal deficit should continue to narrow to 1.2% of GDP (gross domestic product) by 2019, helped by firmer energy prices and additional non-hydrocarbon revenue streams, such as value added tax,” it said.
The deficit has been financed primarily by domestic debt, although Qatar returned to the international bond markets in April with a successful $12bn bond sale.
Meanwhile, Qatar Central Bank’s international reserves appear to have recovered to $24.7bn in May; around $20bn was tapped in 2017 to stem the capital outflows.
NBK said public debt is expected to peak at 57.8% of GDP this year, before falling to 54.3% of GDP in 2019.

Fracking to extract oil and natural gas from shale rock has produced a flood of energy in the U.S. and Canada, lowered fuel prices and created tens of thousands of jobs. It’s helped the two countries lessen their dependence on foreign energy and cut their use of coal, the dirtiest fossil fuel, by almost a third since 2008. At the same time, fracking is associated with earthquakes, greenhouse-gas emissions and water and air pollution. Fracking raises questions about whether the benefits justify the costs, whether the minuses can be diminished through technology and regulation, or whether fracking presents a threat so grave it must be banned, an action many communities have taken.

The Situation

Hydraulic fracturing, or fracking, was largely responsible for a 52 percent increase in U.S. oil and gas output from 2008 to 2015 and has made the country one of the world’s biggest producers of the two fuels. Fracking generates a little more than half the oil and gas the U.S. produces today. The practice has yet to take off outside North America. Environmental concerns have provoked a backlash, with bans or limits imposed by several European countries, Canada’s Quebec province and, in the U.S., the states of New York, Vermont and Maryland and hundreds of counties and municipalities. Saudi Arabia and other members of the Organization of Petroleum Exporting Countries tried to drive North American frackers out of business starting in 2014 by flooding the market to push down oil prices. The biggest crash in the price of crude in a generation put some frackers out of business and prompted others to scale back. In 2016, U.S. crude production declined 5.7 percent and gas output fell 1.7 percent. After slashing costs by more than a quarter by adopting more efficient drilling techniques, the fracking industry began to rejuvenate in 2017. At the same time, U.S. President Donald Trump began to reduce energy regulations.

The Background
The first commercial use of fracking was in 1949 in Oklahoma. The technique involves forcing water mixed with sand and chemicals into a well to create fissures in shale rock so the oil or gas trapped inside escapes. Advances in another innovation, horizontal drilling, came in the early 1980s and provided access to shallow layers of shale deep underground. The subsequent exploitation of the Barnett Shale formation in Texas proved large-scale fracking was economically viable, not least because of high oil and gas prices.

The Argument
Advocates of fracking point out that abundant gas has let many U.S. power plants abandon coal, helping drive down energy-related carbon emissions 12 percent from 2005 to 2015. It’s also decreased U.S. dependence on Persian Gulf oil, with U.S. net energy imports as a share of consumption in recent years hovering around 10 percent — levels last seen in the 1980s. The environmental risks of fracking, proponents argue, can be mitigated. For instance, operators can reduce leaks of methane, a potent greenhouse gas, by testing and repairing pressure safety valves. Pollution of nearby water sources can be minimized by ensuring that oil and gas wells are properly sealed with cement. Fracking’s champions say the risks of small earthquakes — linked mainly to the injection of wastewater into underground wells — can be lessened by mapping deep-rock formations and avoiding areas where tremors might result. They say frackers can trim their tremendous consumption of fresh water by recycling wastewater or using foam or gel as alternatives. Opponents say fracking is inherently too hazardous to tolerate. They say that methane leaks not only offset the greenhouse-gas savings from fracking but could outweigh them. Critics say strictly enforced nationwide regulations are required before operators would make investments that might curb environmental risks. They argue that the oil and gas industry has the power to block comprehensive regulation, and that the Trump administration has no interest in such oversight in any case. That leaves in place an existing patchwork of gap-filled laws. Opponents argue that the abundance of fossil fuels fracking produces will prove a curse because it will delay the development of renewable alternatives and thus impede the effort to slow global warming.