Shale Production Slides | Russell T. Rudy Energy LLC
According to a recent article in “World Oil”, shale oil production will drop over 54,000 barrels per day (bopd) in May, or about 1%. A further drop of approximately 86,000 bopd is anticipated in June, per a recent report by the Energy Information Administration. These production declines are primarily attributable to the Bakken shale in North Dakota and the Eagle Ford shale in South Texas. However, these are partially offset by an increase in the Permian Basin of West Texas.
When oil prices collapsed, shale operators cut budgets, jobs and rig counts and these moves are finally being reflected in production rates. However, these decreases might be short-lived. Just as prices have responded positively to current and anticipated reductions in crude output, this in turn is prompting some operators to start drilling again. For example, Pioneer Natural Resources has indicated that it could deploy more rigs as early as July.
“Prices are at a level where you’re inviting the deployment of rigs again, so the view of supply significantly falling may be misguided,” according to Harry Tchilinguirian, the head of commodity market strategy at BNP Paribas.
To read the article in its entirety, please go to http://www.worldoil.com/news/2015/5/12/shale-oil-production-cuts-to-get-bigger-next-month-eia-says .
