Total CEO Says Cheap Oil Will Prevent U.S. Energy Independence

The chief executive of French oil major Total said the United States will 

not reach its aim of energy independence as the drop in oil prices will 

hit Americ

an shale oil producers.

"It is not true the U.S. will be independent in oil, they continue to i

mport," CEO Patrick Pouyanne told CNBC in an interview on Friday.

"Yes, production in the U.S. has increased from 6 million to 11 million 

barrels (per day) but the U.S. consumes 18 million barrels and part of 

the oil is coming from (the Middle East)," he said, according to a 

transcript distributed by the business television news channel.

The United States has enjoyed a resurgence in oil and gas production in 

recent years as higher oil prices and technological innovation spurred i

nvestment in high-cost shale formations in states such as North Dakota 

and Texas.

American President Barack Obama said last September that energy 

independence was "closer than it's been in decades".

Total's Pouyanne said the rapid decline in the number of rigs drilling 

for 

oil in the United States, which fell to the lowest since December 2011 

last week, was a sign that U.S. production would quickly adjust to lower  
prices.

The weaker oil price, which has more than halved since June, would 

also have a particular impact on leveraged independent oil and gas 

producers, he said.

"Most of these shale developments were based on big borrowing, you 

know the big banks, cheap money, we have plenty of money as interest 

rates were very low," he said. "I think it's like a bubble there which is 

just exploding, it will have an impact."

The French oil major, Europe's second-biggest oil company, took a $6.5 

billion impairment in the fourth quarter, mainly on its North American 

shale gas and oil sands projects.

However, the drop in oil prices is welcome news for U.S. consumers, 

Pouyanne said.

"U.S. investors in oil and gas are not happy. But globally speaking for 

the U.S economy, as it's an importing economy, it is good news," he 

said. (Reporting by Michel Rose, editing by David Evans)