U.S. Oil Production needs at least $60/bbl to grow again

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dan_s
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Joined: Fri Apr 23, 2010 8:22 am

U.S. Oil Production needs at least $60/bbl to grow again

Post by dan_s »

US shale production can reach new highs beyond 13 million b/d, but needs $60/b: Rystad < In my opinion, it will take at least $65/bbl WTI for many months before we see the active drilling rig count get back to what's necessary to grow U.S. oil production. It will take at least 600 rigs drilling for oil and today there are only 180 rigs drilling new oil wells in the U.S..

https://www.spglobal.com/platts/en/mark ... 60b-rystad

"A dearth of well drilling for most of this year and into 2021 should gradually bring up prices to a level around $60/b WTI needed to restart activity, which has languished from the twin bogeys of low oil demand and low prices, upstream specialists said at the Rystad Energy 2020 Americas Virtual Annual Summit.
"If supply is to keep up with demand, we need a lot of shale volumes going forward," Leslie Wei, Rystad's vice president of E&P research, said. "We believe shale needs to deliver 6 million-11 million b/d from wells not yet drilled." To unlock this activity and restart a new shale activity upcycle, "we believe oil prices need to recover significantly from today's levels,"
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34465
Joined: Fri Apr 23, 2010 8:22 am

Re: U.S. Oil Production needs at least $60/bbl to grow again

Post by dan_s »

Reuters: Fracking services will not recover to pre-pandemic levels until 2025 per Rystad Energy
"Demand for U.S. fracking services will not return to pre-pandemic levels until 2025, consultancy Rystad Energy said on Tuesday in an online presentation. A recovery in demand for hydraulic fracturing services will be “slow and painful,” Thomas Jacob, vice president of Shale Research said. Between 250 and 300 fracking fleets will meet demand, even if U.S. oil prices recover to above $60 a barrel, he said."

Keep in mind that U.S. oil production peaked in November, 2019 and slowly declined through March, 2020 despite more than 325 frack crews running.
Dan Steffens
Energy Prospectus Group
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