https://www.bloomberg.com/news/articles/2018-01-31/u-s-oil-output-reaches-highest-level-since-1970
The light at the end of the tunnel is in sight for those of us in the Deep blue / Shallow brown. My understanding is this is only sustainable as long as the Saudis maintain their cutbacks.
Just watching a talking head on TV with Maria Bartaromo, I think it’s Denis Gartman. He explained that frackers are now able to produce most US shale oil below $25, and that he cannot see oil prices stabilizing above $64.
The United States is killing the goose that’s laying the golden eggs. Unless American producers reign themselves in someone (Russia, Saudi, Iran) is gonna say ‘fuck it’ and open their taps. Prices will crash.
The big investors know this. They know that investing billions in offshore wells is unacceptable risk versus investing in quick and cheap onshore shale.
Contrary to what some may think, rapidly increasing US oil output (from shale) is a sign that offshore will not recover soon.
I hear you. $65 - $70 range is optimal for sustainability but if everyone is unloading their trucks all at once then I can see how the other producers won’t appreciate that.
Meanwhile…
I wonder if they will tie back to Perdido. There are already a few other fields tied back to Perdido. Maybe they might have to put another production installation. Plus, I suspect there will be other finds in that area.
Exactly. Absolutely no point in financing large and expensive deepwater exploration/production when there is so much low hanging fruit onshore. . . . .
The US needs to beat OPEC at its own game and stabilize the US oil market.
When the price of WTI drops below $50, a $10 tax on imported oil should be imposed until the price of WTI stabizes above $60 for at least 30 days. Taxes have to come from somewhere. OPEC cannot be allowed to continue manipulating boom and bust cycles in the US through predatory pricing.
The US needs to do whatever it takes to become a net energy exporter as soon as possible. That should be easy to accomplish by ramping up gas production and exports.