July 19, 2021

BITTEN:

The U.S. Shale Revolution Has Surrendered to Reality (Justin Mikulkaon, Jul 16, 2021, DeSmog)

"Drill, baby, drill is gone forever." 

That was the recent assessment of Saudi Prince Abdulaziz bin Salman of the American oil industry's future potential. As Saudi Arabia's energy minister, Prince Abdulaziz is one of the most influential voices in the global oil markets. Fortune termed it a "bold taunt," and a warning to U.S. frackers to not increase oil production. 

The response by the U.S. producers -- to shut up and take it -- quietly confirms this reality. Shale oil's era of growth appears to be over. The reason is that even as global oil demand and prices rise, the economics of the shale oil business model continue to not work. The U.S. shale industry has lost hundreds of billions of dollars in the past decade producing oil and selling it for less than it cost to produce.

This was possible because despite the losses, investors kept giving the industry money. But now investors appear to have grown tired of losing money on U.S. shale companies and new lending to the industry has dropped dramatically.

Those Nationalists would just keep throwing OPM at it. 
Posted by at July 19, 2021 12:00 AM

  

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