US Oil Boom More Like A Whisper, Drilling Data Say
International Business Times
Published Feb 11, 2015 10:53AM ET
US Oil Boom More Like A Whisper, Drilling Data Say
By Maria Gallucci -
U.S. energy companies are easing off on the creation of oil wells as crude prices hover around six-year lows, according to drilling data released Wednesday. The slowdown in production is costing the American economy thousands of jobs and could halt the U.S. oil boom until prices recover.
Oil companies drilled 28 percent fewer wells in January across the continental U.S. than they did last June, an analysis by Rice University’s Baker Institute for Public Policy found. Oil prices per barrel have plunged by more than one-half since last summer -- from $100-plus then to about $50 now -- as the global crude supply outstrips demand.
Wells drilled in January can produce about 515,000 barrels of oil a day, or 8.5 percent less crude than wells drilled in June, according to Drillinginfo Inc., which supplied data for the report. In the past month, oil production has continued to drop, falling by about 9 percent in January as the number of oil rigs and new permits for drilling steadily decline, the Drillinginfo Index said.
The data came on the heels of a Tuesday announcement by the Halliburton Co., a Houston oil-field services firm, that it plans to cut between 5,200 and 6,400 jobs as oil and gas production slows. The cuts represent from 6.5 percent to 8 percent of the company’s 80,000-person workforce.
“Unfortunately, we are faced with the difficult reality that reductions are necessary to work through the challenging market environment,” Halliburton representative Emily Mir told reporters in a statement.
Baker Hughes Inc. said last month that it would cut 7,000 jobs worldwide because of lower oil prices. Globally, the world’s top four oil-field services companies have slashed a combined 30,000 jobs in recent weeks.
Get The News You Want
The scaling back of U.S. energy production is a victory for the Organization of Petroleum Exporting Countries, led by Saudi Arabia. The oil cartel has so far declined to curb its own production, a move that would shore up crude prices and allow North American firms to maintain market share. OPEC said Monday it now expects countries outside the cartel to grow production by just 850,000 barrels a day in 2015, down from its previous forecast of 1.27 million barrels a day.
Written By: International Business Times
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.