Unfortunately no one can.
US production has crested the cliff and is now in free fall. Daily barrels per day is now a million less than its peak last year. With a 100k BPD drop in June alone.
There is talk about completing all of the drilled wells, and how that will bring production levels back up. If it was that simple, then companies would have already done do. There are no shortages of workers or equipment. If the petro companies don't think they are worth completing, then the estimated yields are not worth the cost of completing them ar $50 per barrel. And if they are not worth that, then they don't have a chance at stopping the US drop, let alone reversing this decline.
America still has a lot of oil in the ground. It is just in small deposits that are hard to get to, and cost a lot per barrel. It's why the catastrophic drop in rig counts should be concerning. These shale fields deplete quick, and new wells are required to keep coming online to replace them. These past 18 months have ground all progress to a halt though. Nothing is being developed, and everything is aging. The big offshore rigs in the Gulf will decline slowly, but the shale fields are starting to run out quick. And the numbers are showing it. I can only see this decline increasing. By the end of the year the US could be down another million BPD.
Monday, July 4, 2016
Make American Production Great Again
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