On January 30, we hosted Dr. Murat Fatih Tuğan and Dr. Okan Yardımcı in our YouTube talk, "The Future of Oil and Natural Gas in the 21st Century". Both of our guests have major experiences in the oil and natural gas sector and published a new book in Turkish named "21. Yüzyılda Petrol ve Doğal Gaz Mühendisliği" which discusses the recent development in oil and natural gas engineering. It is the first Turkish book published which elaborates the technical, economic, legal, and technological improvements in the sector.
In the first part of the session, Dr. Okan Yardımcı discussed the role of oil among other energy resources and claimed that despite the share decreased, fossil fuels remain a vital source. Improvements in technology enabled additional discoveries on fossil reserves.
The main contribution to the oil and gas reserves came from the shale revolution at the beginning of the 21st century. At this point, Dr. Murat Fatih Tuğan explained the technical details behind the shale developments and showed how it affected oil and natural gas in the world.
After discussing the recent developments on the technical side of the story, Dr. Okan Yardımcı discussed the financial role of oil globally by stating that there are oil-rich and rich oil countries. By providing data, Dr. Yardımcı showed that oil's share in the financial markets is three times larger than all the other commodities used in energy production.
In the Q&A part, we had a chance to discuss the recent oil and natural gas events in different parts of the world.
First, we discussed the status of oil production in Venezuela. Dr. Tuğan stated that Venezuela is the largest oil reserves. Since Venezuela has heavy oil, it can be blended with other light oils to have various types of petroleum products such as diesel. On the other hand, some of the chemical elements to produce Venezuelan oil is supplied from the United States.
In the United States, we had a chance to discuss Joe Biden's energy and climate policies from petroleum engineers' perspectives. Dr. Okan Yardımıcı focused on the Obama administration. Dr. Yardımcı stated that Obama was also favored climate-friendly approaches yet supported the shale oil sector's developments to improve the American economy. In 2011, Environment Policy Agency (EPI) conducted a study to understand the impact of shale oil production on the environment. In the first draft report, when EPI claimed that the operations are not so friendly. In the end, EPI receives a budget cut from the Obama administration at the rate of 17 percent. Therefore, Dr. Yardımcı concluded that the Biden administration would be pragmatic when it comes to economic interests, similar to the Obama administration.
We also had a chance to discuss the impact of social media on commodities. Dr. Yardımcı stated that GameStop and silver speculations would lead American and British authorities to impose additional financial market regulations. In terms of prices, Dr. Yardımcı suggested that politicians' role will be significant in the upcoming years, as it happened at the beginning of the COVID-19 pandemic.
Finally, we had a chance to discuss the possible development opportunities of shale oil in Turkey. Dr. Tuğan claimed that there are differences between the United States and European countries in terms of oil legislation since the oil belongs to the estate owner in the United States while it belongs to the state in Europe. Therefore, it gives incentives to people to invest in the United States.
Another critical issue Dr. Tuğan mentioned is that in the United States, services in this sector is highly developed, which enables costs to be lower compared to Turkey. It gives American investors feasible options. In the Turkish example, since the operations are so expensive, minor volatilities in oil price make projects infeasible.
Furthermore, in terms of equipment for shale operations, European countries have significantly fewer options compared to the United States. Therefore, mobilization costs also create a burden on the operations. Overall, European countries are not as developed as their American peers in terms of know-how.
Despite these differences, Dr. Tuğan concluded that shale revolution can happen in anywhere that has reserves around the world if there is demand and economic feasibility.
Overall, it was a pleasure for our center to have two senior energy expert in our event. We had a chance to discuss many issues that awaits us in terms of energy in our future.