Execs say it would take long-term problems to increase oil, gas production in Lower 48
Friday, March 18, 2022
Oil and gas industry executives believe it will take more than $100/bbl oil and an energy crisis in Europe for exploration and production companies in the Lower 48 to substantially increase production, according to Natural Gas Intelligence.
Although U.S. sanctions on Russian oil and gas have impacted global supply, some oil executives believe it is only a temporary problem and it would take more to make any significant production increases.
“Nobody believes this problem is long-term,” said Pioneer Natural Resources Co. CEO Scott Sheffield at the CERAWeek by S&P Global conference earlier this month.
Sheffield cited steep backwardation in the long-term oil price curve as evidence that the market does not expect lingering supply constraints.
Chesapeake Energy Corp. CEO Nick Dell’Osso expressed a similar view to Sheffield, believing there would the current supply of oil and gas in the market matches the current demand pretty well and without a change, there’s no need to increase annual production beyond single-digit percentages.
Learn more: Natural Gas Intelligence > Can Lower 48 Ramp Up Production? Not So Fast, Execs Say
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