Talking-up Scotland

© oilprice.com

Though prices just under $50 per barrel are profitable for North Sea oil extractors they’re too low for shale oil extractors. I’ve already written about shale oil’s limited future:

The Scottish Third Wave of Oil Productivity is built on solid foundations but those of the Shale Oil Industry are built on sand and on sand that is disappearing fast

Now see this from Oil and Gas People:

‘That [prices around $46pb] could make this week a turning point for the troubled global oil market — the moment when shale companies showed signs of bowing to the low prices they helped inflict.’ “This U.S. surge is showing signs of plateauing and customers are tapping on the brakes”, Halliburton Executive Chairman Dave Lesar told analysts on a conference call earlier Monday. The comment came just days after data from Baker Hughes showed explorers cutting the number of U.S. rigs for the second time in four weeks.’

Safety factors too look like further weakening shale’s prospects. Major extractor Andarko which already had lost nearly $1 billion in the last two years, had a fatal explosion in April that that has led it to shut down 3 000 wells for inspection. Also, risks to the public continue to come up reducing the attractiveness of the business to investors scared off by possible compensation costs. On top of these, staffing shortages are putting a cap on growth in fracking. See these:

Scottish Oil predicted to rise to at least $60 per barrel by end of 2017 as fracked shale oil faces safety crisis

https://theferret.scot/dont-scotland-fracking-warning-pennsylvania/

http://oilprice.com/Energy/Energy-General/Shortage-Of-Fracking-Crews-Slows-The-Shale-Boom.html

https://www.oilandgaspeople.com/news/14745/shale-boom-may-finally-have-succumbed-to-oils-price-slump/