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Texas is about to create OPEC's worst nightmare

Started by Pat Goss, December 07, 2018, 05:27:54 pm

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Pat Goss

The map lays out OPEC's nightmare in graphic form.

An infestation of dots, thousands of them, represent oil wells in the Permian basin of West Texas and a slice of New Mexico. In less than a decade, U.S. companies have drilled 114,000. Many of them would turn a profit even with crude prices as low as $30 a barrel.

OPEC's bad dream only deepens next year, when Permian producers expect to iron out distribution snags that will add three pipelines and as much as 2 million barrels of oil a day.

"The Permian will continue to grow and OPEC needs to learn to live with it,'' said Mike Loya, the top executive in the Americas for Vitol Group, the world's largest independent oil-trading house.

The U.S. energy surge presents OPEC with one of the biggest challenges of its 60-year history. If Saudi Arabia and its allies cut production to keep prices higher, shale will thrive, robbing them of market share. But because the Saudis need higher crude prices to make money than U.S. producers, OPEC can't afford to let prices fall.

https://www.msn.com/en-us/money/markets/texas-is-about-to-create-opecs-worst-nightmare/ar-BBPWgMM

Permian companies are drilling wells but, for now, aren't fracking many of them. Those wells are becoming a reservoir of ready-to-tap production once the new pipelines -- Gray Oak, Cactus II and Epic -- come online.
Quote from: RyanMallettsEgo on July 16, 2020, 06:04:44 pm
That all you got, Pat? No royal family or Taylor Swift news today?

Quote from: Pat Goss on July 16, 2020, 06:06:07 pm
Taylor has a vinyl album out

woodrow hog call

Good read, thanks for posting. I like the sound of it.
"I hate rude behavior in a man, I won't tolerate it"