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Is the fracking revolution overhyped?

The Daily Ticker
The Daily Ticker
Daily Ticker

The nation's booming natural gas industry has transformed the U.S. energy landscape. Yet Dan Dicker, author of Oil's Endless Bid and a long-time oil trader, argues the U.S. shale revolution has been "overhyped." He tells The Daily Ticker that hydraulic fracturing (or fracking) of shale rock has increased U.S. energy production by 3.5 million barrels a day -- a significant increase from previous years but not nearly enough to keep up with global demand.

Related: Fracking has made the U.S. “the envy of the world”: Russell Gold

"What has happened in the shale revolution has been significant for us but globally speaking it hasn't been enough to off set the increases in demand that will come over the next few years," he tells The Daily Ticker's Aaron Task and Henry Blodget in the video above.

Energy companies extract oil and natural gas from shale rock by injecting a mixture of sand, water and chemicals at high pressure. Natural gas is released through fissures, drawn back up the well to the surface, where it is processed, refined, and shipped to market.

Related: Fracking Is “the Biggest Boom Since the Housing Bubble”: Will It End the Same Way?

Dicker expects the U.S. to increase its energy output by another 1.5 million barrels per day over the next two to three years. But an erosion of wells and higher demand by emerging nations for oil will erase the gains made by U.S. energy companies.

"It's a bubble and it will burst at some time," Dicker adds.

Dicker predicts oil prices to reach $130 a barrel by 2015.

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