The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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US shale production will definitely suffer long term, from my research I’ve seen predictions of up to 6mbpd over the next 2-3 years.. markets always like to price in potentials so the rig numbers for example are very important.. if the numbers fall to say just under 300 in the next 3-4 weeks that would be a very clear indicator that long term production in US will be dire... I always have my reservations when it comes to OPEC but I don’t think they will **** up this time round... I hope they will make that deal with an option of further cuts from potential partners etc that would be the most ideal scenario and will bring stability
Weekly reports are projections based on previous averages, shale patch production is going to fall off a cliff. Rigs dropping at record rates, fracking crews going into hibernation. Its inevitable unless the great US is now getting oil from shale without drilling or fracking. Also there is talk of shutting in GOM due to amount of CV cases on the rigs. That excuse number 2 to shutin production and not have appearance of joining the cartel
Oiluser: "US crude oil production as estimated by the Energy Information Administration showed that production for the week ending March 27 was unchanged at 13.0 million bpd."
Trump, succes on friday! :)
Trump cant join the party, theres a bill going through either the Senate or Congress re cartel behaviour of OPEC etc
But that aside, Exxon just pulled 10billion capex and primarily from Permian. Coupled with the mass drop in rigs that will continue this week and for foreseeable the shale output will fall off a cliff, no help required from Trump. OPEC know this, the question will other non opec producers join and Norway has signalled it will. But it's going to take a gesture from the US, it may come in the form of an accurate EIA report re US production levels.
Shpunken, That is 10% of what is needed, reality-wise speaken?
Marcel, yesterday’s report already officially confirmed the 2mbpd figure
Adam, he last mentioned 2 days ago, saying that first he wants to see the OPEC deal and then if he is satisfied US and Canada might join.. but straight after he said, the law does forbid any cuts etc but if needed he will work something out.. so there is no chance of US joining the cut tomorrow.. and a very slim chance of joining later, unless the US production numbers don’t drop on their own... I was more excited about Canada wanting to join tbh, and Norway as well, that would be a very positive spin for sure
Shpunken:
"There is so much noise in the market right now, and the (Shale) decline was so modest, that this moment passed largely unnoticed. It will be the end of April before we get another snapshot of activity from the shale patch to confirm that down is now the trend, or what happened in March was a head-fake."
Trump needs to keep shale alive, but also Trump needs to cut along with the other players to get what he wants...
You can't have it both ways. That is why this meeting will not be fruitfull right now on friday, imo.
Indeed Jadam,
https://oilprice.com/Energy/Oil-Prices/When-Will-Oil-Bounce-Back.html
"Quite simply there is an ocean full of oil floating in oil tankers just waiting to offload, at ports that are already chock-a-block. This does not bode well for the beleaguered oil market ***that is desperately searching for good news***."
Trump already said several times that US won’t be joining any cut, officially.. they don’t need technically as the API numbers showed that in this quarter production will drop to just over 2mbpd which is a pretty big number.. and that might not be final as more companies are going bust.. number of rigs keeps dropping at an impressive rate... And the number will be extremely important, market expects 10-15m so that’s the minimum that we better see
Absolutely right JAdam,
Everyone banging on about 15m cuts, do you think Trump is going to play ball and join the collective???
I’m no deramper, but I don’t see Trump joining the party, On this agreement, “ just yet “ IMO ( based on my understanding and assessment of trump )
It’ll take a little jostling I reckon with Trump
Goes ahead tomorrow and a conclusion is agreed to cut production by 10/15mbl where do you all see the sp heading tomorrow afternoon/ Tuesday morning? I’m expecting us to finish blue today on anticipation of the meeting being an agreed production cut...