I believe that additional advances are going to be limited in the near future by an oil price that is slightly trending down.
Energy price forecasts are highly uncertain, and the current values of futures and options contracts suggest that prices could differ significantly from the forecast levels. WTI futures contracts for December 2014 delivery, traded during the five-day period ending September 4, averaged $93/bbl. Last year at this time, WTI for December 2013 delivery averaged $106/bbl.
Thanks for your insights in #8 & 9. I agree that short-term info supports lowering prices which will depress exploration and the possibility of new fields. At some point, the pendulum will swing the other way and that will be when the potential will go up for new finds. Of course, no guarantees, merely the potential due to profit motive.
Two things on this.
I think that its pretty apparent that EOG does not have a strong position in the Permian Basin where several players with strong permian positions have said US production can hit 14 million barrels @ day—provided oil prices stay high.
will oil prices stay high? This is such a crap shoot that I wouldn’t hazard to guess. Why? Well just today reports are the the russians are talking to the saudis about oil prices and OPEC has announced they’ll cut production by 500,000 barrels a day. That instantly bounced up oil prices. There’s a lot of deep pocketed players with an interest in keeping oil prices high. Not the least of which are the saudis and the russians whose governments depend on high oil prices.
But will that be enough to beat the vicissitudes of supply and demand. Beats me.My wag is that at least for the next couple of years the swing producers like the Saudis will cut production to keep prices high if there are any serious downdrafts that threaten their core interests.