The expected boom in shale output masks a list of underlying problems that confront the sector. Most companies are still not generating positive cash flow and remain highly dependent on borrowing from the debt markets.
This past year, news surrounding energy security continued to occur at a rapid pace, with OPEC extending its production cuts (twice), car companies outlining their strategies for electric and autonomous vehicles, and geopolitical supply outages increasing oil prices. We’ve published numerous stories and infographics, commenting on the major energy security issues of the day. Here are 10 standout pieces from 2017.
Oil markets surprised this past year with higher-than-anticipated prices, & next year will likely bring even more unanticipated events and volatility. Here are some of the top market developments of the past year and key issues for 2018.
Shale has upended global energy markets but two questions remain unanswered: Can it be called upon to meet demand growth, and will it ever be profitable?
A clumsy exit strategy, producers cheating on quotas, or a rapid response from U.S. shale producers could undermine the effectiveness of the deal. Conversely, the potential for higher prices is also a stark possibility.
As OPEC and its non-OPEC allies gather in Vienna this week, it will mark the three-year anniversary of the cartel’s pivotal decision to produce all out and allow prices to fall sharply.
OPEC will attempt to manage perceptions in both the physical and financial markets—but given its track record, it will not likely produce stability and certainty, but instead ambiguity and volatility.
The oil majors are posting their best quarterly figures in years, an indication that they are adapting to the new price environment. After several years of spending cuts and rising debt, the largest integrated oil companies have turned a corner.
OPEC has changed not only fundamental dynamics of the oil market, but the entire narrative: There’s very little, if any, talk about “lower for longer”—the issues currently rattling the market are not going away any time soon.
In the shale patch, rig productivity is falling, companies are no longer making headway on drilling times, and cash flow continues to disappoint investors.