Oil production from the Bakken and Eagle Ford shale plays look like they’ve peaked and other shale plays may not be far behind.
Oil production from seven major U.S. shale plays is expected to fall by a total of 86,000 barrels a day in June, according to a monthly report from the Energy Information Administration released Monday. The previous report released a month ago also showed a forecast for a fall of 57,000 barrels a day in May.
Oil output at the Eagle Ford shale play in South Texas is forecast to see the biggest decline, down 47,000 barrels a day in June. The Bakken shale play, which stretches from Canada into North Dakota and Montana, is expected to see output fall by 31,000 barrels a day, the report said. That would follow forecast declines in both regions for the month of May.
“The data shows that production in the Bakken and Eagle Ford [plays] peaked in March at 1.33 million barrels a day and 1.73 million barrels a day, respectively,” said James Williams, energy economist at WTRG Economics.
U.S. Energy Information Administration
coffeeguyzz on Tue, 12th May 2015 7:42 am
Does the fact that about 1,000 wells in ND alone are awaiting fracturing/production due to low pricing not signify ANYTHING?
1,000 wells, theoretically producing simultaneously 1,000 barrel IP, is ANOTHER million barrels.
HELLO?
rockman on Tue, 12th May 2015 8:31 am
1,000 wells won’t be frac’d at the same time. And that’s if there are 1,000 wells intentionally not being frac’d at this time. How ever many wells are waiting to be frac’d a number on them are just waiting their turn for frac crews as has been the case since the play began.
LOE on Tue, 12th May 2015 9:03 am
When you don’t include proven reserve numbers with articles like this you show how little you know. Production reductions occur for numerous economic reasons and are positive for the oil market often. When I shut in a well for being uneconomic that doesn’t mean the well is unproductive it just means I’m not selling oil at a price I don’t like.
JuanP on Tue, 12th May 2015 9:37 am
“Still, the rate of decline for shale oil production “isn’t fast enough to expect a change in OPEC’s policy at the June 5 meeting”
I will make a forecast about the next OPEC meeting; it is the same forecast I have been making for OPEC meetings for a while. There will be no new policy agreements coming from that meeting because its members can’t agree on anything. I suspect OPEC members may never again agree on anything for political and economic reasons. I have been right in these forecasts the last few times, I suspect I will be right again.
JuanP on Tue, 12th May 2015 9:41 am
Some of us here have been saying for months that this was going to happen for months, particularly Rock. I expect US oil production to decline for the foreseeable future unless there is a price spike, and I don’t see that coming. Batten the hatches, guys, there’s a storm a coming and we are in for a rough ride.
waltz on Tue, 12th May 2015 9:49 am
Some “proven reserve numbers” turn out to be “uneconomic”….
Welcome to diminishing returns and the down side of the peak….
BobInget on Tue, 12th May 2015 9:49 am
Bullish EIA Report.
Note last paragraph in particular.
Note how imports are just now beginning to dry up.
Summary of Weekly Petroleum Data for the Week Ending May 1, 2015
U.S. crude oil refinery inputs averaged over 16.3 million barrels per day during the week
ending May 1, 2015, 247,000 barrels per day more than the previous week’s average.
Refineries operated at 93.0% of their operable capacity last week. Gasoline production
decreased last week, averaging about 9.2 million barrels per day.
Distillate fuel
production increased last week, averaging 5.0 million barrels per day.
U.S. crude oil imports averaged over 6.5 million barrels per day last week, down by
905,000 barrels per day from the previous week. Over the last four weeks, crude oil
imports averaged over 7.2 million barrels per day, 5.0% below the same four-week period
last year. Total motor gasoline imports (including both finished gasoline and gasoline
blending components) last week averaged 626,000 barrels per day. Distillate fuel imports
averaged 112,000 barrels per day last week.
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum
Reserve) decreased by 3.9 million barrels from the previous week.
At 487.0 million
barrels, U.S. crude oil inventories are at the highest level for this time of year in at least
the last 80 years. Total motor gasoline inventories increased by 0.4 million barrels last
week, and are above the upper limit of the average range. Finished gasoline inventories
decreased while blending components inventories increased last week. Distillate fuel
inventories increased by 1.5 million barrels last week and are in the middle of the average
range for this time of year.
Propane/propylene inventories rose 1.8 million barrels last
week and are well above the upper limit of the average range. Total commercial
petroleum inventories increased by 6.6 million barrels last week.
Total products supplied over the last four-week period averaged 19.0 million barrels per
day, up by 2.8% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged 9.0 million barrels per day, up by 3.9% from the same period
last year. Distillate fuel product supplied averaged 3.9 million barrels per day over the
last four weeks, down by 4.3% from the same period last year.
Jet fuel product supplied
is Up 12.4% compared to the same four-week period last year.
BobInget on Tue, 12th May 2015 9:58 am
Link for above report;
http://ir.eia.gov/wpsr/wpsrsummary.pdf
Note that distillate production was higher, yet
‘product supplied’ lower. IOW’s, demand exceed supply.
(Distillates: diesel, heating oil, kerosene, jet fuels)
If diesel and jet fuel are ripping double digits
the economy is doing OK.
This is the second week of double digit jet fuel consumption.
John Keller on Tue, 12th May 2015 12:13 pm
People are not focusing on demand which is ripping higher. Texas gasoline receipts for January were up 10% year over year. Texas consumes 10% of US gasoline. VLCC tanker rates are abnormally high for this time of year. Oil is moving around. The world oil market will be balanced by mid-year (if it isn’t already) and moving into deficit in the second half.
nony on Tue, 12th May 2015 2:25 pm
Clr says they will peak in may and finish the year about 5 pct above end of year 2014.
Zomfg. Disaster. No. But not expected growth from before the price drop.
hiruitnguyse on Tue, 12th May 2015 2:28 pm
New RF today;
http://ricefarmer.blogspot.fr/
nony on Tue, 12th May 2015 2:29 pm
Rock. Completions were turned off faster than drilling. So you’re wrong. See clr and eog calls. Ndic state report. Lots of analysts.
Stop shooting from the hip. Some of the backlog is normal. Maybe 40 pct of it. But not all.
Apneaman on Tue, 12th May 2015 2:55 pm
“the economy is doing OK”
It’s the people that are fucked.
RECORD: AMERICANS NOT IN LABOR FORCE — 93,194,000
http://www.washingtontimes.com/news/2015/may/8/record-americans-not-labor-force-93194000/
dissident on Tue, 12th May 2015 4:08 pm
I was just told that we are heading for an oil utopia. Fracking was supposed to solve all our supply problems. This article can’t be right. I want to believe the in the oil utopia. I need my free lunch. I like the taste of the corporate media koolaid.
Nony on Thu, 14th May 2015 4:25 pm
Fracking stopped the 100 from going to 150. And it actually drove the 100 down to 70 (the 45 and even the current 60 is more temporary “glut”). this is a huge significant thing. But not utopia.
I actually supported Rock when he called out the significance of the 100 (even with volume increasing). But he was dishonest not to acknowledge the role of shale in preventing 150 and in creating ~70. Then again, he is a mudlogger, not an economist or a trader.