America’s Shale Boom Keeps Rolling Even as Wildcatters Save Cash

America’s surging shale oil production shows little sign of abating, despite industrywide spending cuts, as explorers learn to do more with less. Accordint to Bloomberg, almost all the independent producers have reduced their budgets for 2019, but many still expect to deliver double-digit growth in production this year, fourth-quarter earnings reports show. Growth is slowing but still strong: the U.S. will add about 1.45 million barrels of oil a day on average this year, down from 1.6 million in 2018, according to the Energy Information Administration. “The machine still has enough cash available that it can continue to grow at a rate that’s material,” said Raoul LeBlanc, a Houston-based analyst at IHS Markit, said by phone. The rest of the world “is now not going to be flooded with oil, but still mildly glutted.”The tumble in oil prices at the end of 2018, combined with investor demands for fiscal discipline, has prompted most shale executives to only invest what they earn in cash flow, ending years of debt-fueled growth. But the scale of past investments and low service costs mean that the cutbacks will only put a dent in growth projections.

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3 minutes ago, rainman said:

America’s surging shale oil production shows little sign of abating, despite industrywide spending cuts, as explorers learn to do more with less. Accordint to Bloomberg, almost all the independent producers have reduced their budgets for 2019, but many still expect to deliver double-digit growth in production this year, fourth-quarter earnings reports show. Growth is slowing but still strong: the U.S. will add about 1.45 million barrels of oil a day on average this year, down from 1.6 million in 2018, according to the Energy Information Administration. “The machine still has enough cash available that it can continue to grow at a rate that’s material,” said Raoul LeBlanc, a Houston-based analyst at IHS Markit, said by phone. The rest of the world “is now not going to be flooded with oil, but still mildly glutted.”The tumble in oil prices at the end of 2018, combined with investor demands for fiscal discipline, has prompted most shale executives to only invest what they earn in cash flow, ending years of debt-fueled growth. But the scale of past investments and low service costs mean that the cutbacks will only put a dent in growth projections.

 

“In 2019, the International Energy Agency predicts, America’s oil boom will represent the biggest surge in production anywhere in the world since the agency started keeping track.”

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Oil prices are 6% higher relative to a month ago and the daily under-recovery rate from the DME points to an increase in fuel prices for March. Have a lovely day....

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