U.S. shale firms are drilling themselves into a deep hole despite warnings from industry leaders about the risk of flooding the market with too much crude.
Drilling and production are rising. Prices are declining. Companies are barely breaking even or losing money. Costs are starting to rise. And share prices are sliding.
Current oil prices are not sustainable according to Harold Hamm, the chief executive of Continental Resources, said in an interview on June 28.
Prices need to be above $50 per barrel to be sustainable and below $40 would force producers to idle rigs, Hamm said ("Harold Hamm warns oil prices below $40 will idle U.S. drilling", CNBC, June 28).
"While this period of adjustment is going on, drillers don't want to drill themselves into oblivion. Back up, and be prudent and use some discipline," he urged rival chief executives.Continue this article by clicking here.
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