Shale oil's new calculus
Will producers chase growth or profits?
It didn't take long for the tight oil industry's new value-over-volume mantra to face its first test. Shale executives spent much of late 2017 trying to convince investors that they had received the message on capital discipline. Growth at all cost was out and free cash-flow was in. That was before the oil price surge. From October to mid-February, prices jumped 30% to $65 a barrel, a level that makes just about any shale well look enticing. Oil's rally, then, will prove a tempting diversion on the path to a new, more sustainable, business model. Executives would be wise to resist the temptation to restart the drilling frenzy. The industry is at something of a crossroads. After proving its m
Also in this section
5 February 2025
Growing appetite for LNG reinvigorates discussions between China and Myanmar, but civil war may prevent talk becoming action
5 February 2025
With new capacity, buyers must navigate sanctioned Russian crude, a return to traditional OPEC barrels and diversity of supply
4 February 2025
The threat of Trump tariffs and the departure of Trudeau have sharpened the domestic political focus on boosting the oil and gas industry
3 February 2025
Alaska has been engulfed by a lack of consistent policymaking and highlights the challenges financing energy projects in the US
