1. U.S. shale won’t rebound until 2022?
- U.S. shale drilling activity will not recover until at least 2022, according to shale and oilfield service executives themselves.
- The Dallas Fed surveyed nearly 170 industry executives and found widespread pessimism regarding the health of the oil patch for the next few years.
- The same was true for their perception of oil demand. Only about 5 percent believe that global demand has already peaked, but more than 35 percent think demand won’t hit pre-pandemic levels until 2022.
- “I am a professional geologist and independent producer who has been involved in the oil and gas business for almost 50 years, and I have never experienced an environment such as what we are living through today,” one unnamed executive said.
2. Shale activity hits record low
- The business activity index, a broad measure of conditions in Texas and parts of New Mexico, fell from -50.9 in the first quarter to -66.1 in the second, which is the lowest reading on record since the Dallas Fed began recordkeeping four years ago.
- The capex index fell from -49.0 in the first quarter to -66.1 in the second, an indication that spending continued to contract.
- On average, respondents expect WTI to average $42.11 per barrel by the end of 2020, with responses ranging from $22 to $65.
- “This has been the fastest decline in my oil and gas career, and I expect the turnaround…