06-17-2017, 01:11 AM
Cash-strapped U.S. shale firms scaled back their hedging programs in the first quarter, leaving them more vulnerable to tumbling spot market prices just after OPEC reached a landmark deal to curb global supply. The pullback in hedging was driven by rising service costs and expectations that prices would continue to rally after the Organization of the Petroleum Exporting Countries extended those cuts in May, analysts said.
U.S. shale firms more exposed to falling oil prices as hedges expire | Reuters
Rising US shale oil production has put short-term supply concerns centre stage as the oil market downturn enters its third year. But for Opec producers, worries about when demand for their crude will peak is only gathering pace and India is in focus. The south Asian nation is tipped to be the world’s fastest-growing oil consumer over the next two decades. Its population of 1.3bn people holds the hopes of global oil producers as rising incomes and the rapid uptake of motorcycles and cars boost petrol and diesel, offsetting fading demand in the west.
India is Opec’s litmus test on oil demand growth
Oil companies are applying new hydraulic fracturing techniques to early Bakken wells, a process industry leaders say has the potential to recover more oil without increasing the footprint on the land. Operators are targeting wells drilled between 2008 and 2010, the early years of Bakken development before fracking technology advanced to where it is today. Companies are refracturing the older wells using today’s technology and getting promising results, said Justin Kringstad, director of the North Dakota Pipeline Authority, who recently analyzed the wells.
The two biggest shale gas deposits in the U.S. are producing a record amount of the power-plant fuel, signaling that a fight for market share will intensify as supply outstrips demand. As natural gas prices rebound from last year’s historic lows, output from the Marcellus shale basin in the U.S. East and the Permian reservoir in Texas is driving a rebound in America’s production of the fuel. Low-cost supply from the Marcellus is surging as new pipelines are built to shuttle gas to markets across the U.S. and Canada. Meanwhile, Permian output is rising as a recovery in oil prices boosts the production of gas that’s extracted alongside crude.
Shale Gas Giants Battle for Dominance as U.S. Supplies Surge - Bloomberg