Crude Oil Downturn Takes its Toll on US Shale Oil Plays
If the Saudis intention is to damage US shale oil production as they maintain record crude oil outputs despite a more than 50% drop in the price of oil in the last year, the following two charts illustrate that they are achieving their goal:
Since March there has been a significant turnaround in crude oil production from the big 5 U.S. oily shale plays (Bakken, Eagle Ford, Niobrara, Permian, Utica) as producers shut down higher cost wells and begin to hunker down for a ‘lower oil price for longer’ price environment.
I am also hearing rumors from the oil patch (Texas) that some of the U.S. majors (Chevron, Exxon, etc.) are planning significant across the board workforce layoffs (10-20%) over the coming months.
Chevron’s (CVX) share price has been in a steady downtrend for the last couple of months and recently slid below $100/share