“US Frackers Return to Haunt OPEC’s Pricing Strategy”
“US crude juggernaut adds equivalent of new Venezuela to supply”
“OPEC, allies have restricted supply in response to price drop”
“OPEC’s one-time nemesis — US shale — is rearing its head just months after the sector was all but written off as a threat to the cartel’s sway over worldwide oil markets.
Drillers from the Permian Basin in West Texas to the Bakken Shale of North Dakota have ramped up oil production well beyond what analysts foresaw, pushing output to a record just as OPEC and its allies put the brakes on supplies in a bid to arrest price declines.
This time last year, US government forecasters predicted domestic production would average 12.5 million barrels a day during the current quarter. In recent days, that estimate was bumped to 13.3 million; the difference is equivalent to adding a new Venezuela to global supplies.”
“Part of what makes the US crude surge surprising is that companies managed to increase production even as the number of drilling rigs at work fell roughly 20% this year. That productivity gain has confounded many analysts and researchers who have long relied on the so-called rig count as a predictor of future crude output.”