OPEC or ROPEC is in a lose-lose situation. If they continue the cuts, shale becomes more active and they lose market share and shale puts a lid on upside potential. If they do not continue the cuts, prices drop and and they lose money selling the same product.
Until things change -- like a surge in economic activity in the US and China which creates a huge drop in inventories -- $53.00 per bbl will be the new normal.Buddy Cotten
$53 is a number that US producers can make money on I believe and the trend would be to go higher. Natural gas will hopefully rise from low $3 to $4 in the next year or two.
I sure hope $53.00 will be a milestone; today it still is hanging around 48.00. My family and I have 16 wells, 3 coming off confidential in one month. One we participated in and the other 12 non-participation. Our monthly royalties have not been so good; imagine the oil company is not producing as much when oil prices were low. I wonder how much of a problem the whole Trump situation will be for shale producers. Fingers crossed that royalties will start increasing if shale feels comfortable with more monthly productions and when oil prices continue to rise. Anyone else frustrated with reduced oil royalties? I am trying to retire in six months and expected my oil royalties to be much more monthly than they are. Fairly discouraging.