The response from the drillers to higher prices has been restrained but nonetheless gratifying as just this week we poked through the 600 rig level, not seen since 2020. It’s Too Late To Avoid A Major Oil Supply Crisis Why U.S Shale Companies Are So Undervalued There are a couple that I would recommend reviewing after reading this article. I have also discussed the likely impact of nearly a decade of under-investment in new upstream supplies by hard-pressed oil companies struggling to survive in a lower for longer energy reality. domestic shale companies that was not yet reflected in the market. In those articles, there was deep value in U.S. I’ve authored a number of Oilprice articles on shale and the broader energy market over the past couple of years. These reasons range from the government's messaging to oil and gas companies to OPEC+'s fairly stoic restoration of the 9.5 mm BOPD they cut in 2020 and, of course, the amazing recovery of the global economy, particularly here in the U.S. There are myriad reasons - and we'll just list what we feel are the key drivers - that oil prices have reached today’s levels. Thanks to some cold weather and the burgeoning LNG trade eastward supplies of natural gas are 6.2% below year-ago levels and just above the 5-year average. Stockpiles of crude are below 5-year historical averages. It's no great secret as to how we got to this point. In this article, we will discuss why we feel that shale production, now on the rise, could plateau and even decline as the year progresses. I have been discussing this possibility for a couple of years in Oilprice articles and I’ll link a couple below if you would like to go back and examine my original thesis in light of current events. What’s news is it’s catching a lot of folk off-guard. Shortages in Europe have made the news frequently over the past few months. Around the world, people are discovering that oil and gas are necessary if the energy supply is to be uninterrupted. The signs are emerging that the era of cheap and widely available energy is drawing to a close.
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