Would probably be a bad time to say that shale isn't an infinite resource either. The US subsidized global energy prices through exports at below replacement cost for the past several years. The DUC's have been completed, now we're at full cost drill +complete operations, and if we boost drilling to increase production will need more infra in some areas. There are only so many locations to drill that can get at good rock. If we drill them now, production starts falling sooner. Any appreciable boost in volumes won't show up for 6-8 months, by which time oil prices will have done whatever they're going to do. Coulda/shoulda/woulda filled the SPR when oil was below $40 during the pandemic, didn't. The place with the real reserves is Canada, but we don't want pipelines. Short term decisions, very long term consequences. The ESG crowd was driving for this, hope they're ready for the backlash.
Thanks for this. Clear, comprehensive, concise.
Would probably be a bad time to say that shale isn't an infinite resource either. The US subsidized global energy prices through exports at below replacement cost for the past several years. The DUC's have been completed, now we're at full cost drill +complete operations, and if we boost drilling to increase production will need more infra in some areas. There are only so many locations to drill that can get at good rock. If we drill them now, production starts falling sooner. Any appreciable boost in volumes won't show up for 6-8 months, by which time oil prices will have done whatever they're going to do. Coulda/shoulda/woulda filled the SPR when oil was below $40 during the pandemic, didn't. The place with the real reserves is Canada, but we don't want pipelines. Short term decisions, very long term consequences. The ESG crowd was driving for this, hope they're ready for the backlash.