It is not because of decreased rig count. It is because cash flow at current oil prices is too low to complete most wells being drilled. The implications are profound. Production will decline by several hundred thousand of barrels per day before the effect of reduced rig count is fully seen.
Oil prices don’t change based on weekly rig count reports. Yet every week, there are proclamations by analysts that oil prices are poised to recover because of some change in the Baker Hughes North American rig count
There is a case regarding market efficiency for overturning America’s oil export ban, but this is NOT the one the industry is using in its public relations campaign. That’s because increased efficiency in the world oil market would actually make the country’s oil supply more vulnerable to events abroad.
In his latest research on shale oil French oil geologist Jean Laherrere from ASPO France estimates a Bakken shale oil peak in 2014.
Energy independence. It’s so easy to say, but oh so hard to actually accomplish, which is why the United States has been a consistent importer of oil since the late 1940s.
In this post I present the results from dynamic simulations using the typical tight oil well for the Bakken as recently presented by the North Dakota Industrial Commission (NDIC), together with the “2011 average” well as defined from actual production data from around 240 wells that were reported to have started producing from June through December 2011.
With the media awash in stories telling us how much oil is being discovered around the world, there is one word which the optimists quoted in these stories refuse to utter: Depletion.
A midweek update.