Continental Resources, Inc. (CLR), EOG Resources Inc (EOG), SandRidge Energy Inc. (SD): Will Syrian Contagion Crash the U.S. Economy?

Looking around the rest of the country, lesser known oil basins like the Mississippian Lime or the Spraberry/Wolfcamp are believed to hold vast oil potential that could quickly be developed. In the Mississippian, SandRidge Energy Inc. (NYSE:SD) sees the potential for 3,000 wells in its core operating area. The company needs $9 billion just to develop that core, which is a lot more than its current availability of about $2 billion. Higher oil prices could help the company justify developing those wells even faster. Likewise Pioneer Natural Resources (NYSE:PXD) has the same capital problem in the land it controls. The company sees the potential for 40,000 future wells at a cost of $300-$400 billion, which is a lot more than this $25 billion company can handle at the moment.

For perspective, the U.S. spends about $400 billion each year to import about four billion barrels of foreign oil. If that money was redirected into just Pioneer’s resource base we could unlock an estimated nine billion barrels of oil. While not all that oil would be produced at once, it would be much better for our economy if that money was invested here than in the Middle East.

Clearly, Syrian contagion isn’t the ideal situation for the United States or its economy, at least in the short term. However, looking out over the longer term maybe it will be the event that pushes us toward an energy policy geared toward energy independence. It’s time that instead of being OPEC’s best customer, we become its worst nightmare.

The article Will Syrian Contagion Crash the U.S. Economy? originally appeared on Fool.com and is written by Matt DiLallo.

Fool contributor Matt DiLallo owns shares of SandRidge Energy. Matt DiLallo has the following options: short September 2013 $5 puts on SandRidge Energy. The Motley Fool has no position in any of the stocks mentioned.

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