[thackney]

http://public.woodmac.com/public/views/low-oil-prices-halt-production

We conclude that only a Brent price of $40 a barrel or below would see producers shutting-in production at a level where there is a significant reduction in global oil supply.

However, there is no guarantee that these volumes would be shut-in. Operators may prefer to continue producing oil at a loss rather than stopping production altogether, especially for large projects such as the oil sands and mature fields in the North Sea.

The production most likely to be halted is from US onshore ultra-low output wells. Many produce only a few barrels per day and operating costs vary between $20 and $50. We believe that once the cost of collecting the oil from these wells becomes marginal, shut-ins are likely.

[meatloaf]

I’m curious how older natural gas wells might be effected. Ones that produce higher value liquids won’t be affected. The ones that only produce dry gas are the one’s I’m curious about.

[wolfman23601]

2%? Bring it on.

[ZULU]

So what? As soon as the price goes up again, the fracking and offshore opertations become profitable again. Goldman Sachs and the other international corporations which have been waxing rich on profits from oil will just have to deal with it

Payback is a b***h.

[ckilmer]

I’ve been hearing growing talk that the bottom for oil prices is somewhere +-$35@barrel— or about where we talked about last year coal and natural gas were in btu terms.

Its interesting that these prices should coincide with how much production would need to be taken off line because it was “cash negative on an operating basis”—and that this number roughly corresponds to the amount of oil that needs to be taken off the market in order for supply and demand to come into balance.