Flooring It: Shale Oil And Marginal Cost

In the last few years, US crude oil production has soared above 6.5 mb/d, the highest since 1996, thanks largely to hydraulic fracturing (‘fracking’) combined with horizontal drilling that have allowed shale hydrocarbons to be produced more economically. This In Focus report looks in detail at the cost curve of the oil market particularly shale oil, which has become the latest marginal barrel.

Flooring it: shale oil and the marginal cost curve, published by Energy Aspects, provides an insight into the implications of the shale oil revolution for the US and global oil markets. The report includes

• Data compiled from the from US independent oil companies that indicates the CAPEX expenditure and oil price levels required to maintain growth in shale oils
• A model of a global marginal cost curve for both OPEC and non-OPEC production, with shale oil and other unconventional production methods factored in
• An assessment of the implications of a future fall in oil prices for unconventional oil production across the US and therefore overall US oil supply
• Information on regulatory activity and the impact on US shale oil and gas production
• Comparison of the emergence of US shale oil to the pathway of Canadian oil sand and Brazilian sub-salt production, both recently heralded as game-changers for non-OPEC oil production levels
• Predictions for how shale oil supply will interact with price fundamentals, given the hort lead times for production and the capital intensive nature of the industry
• Detailed data on US oil production overall, by PADD and by shale oil basin; oil rig counts and output of crude and Natural Gas Liquids