Several reports throughout the last couple of months have covered the growing oil supply in the United States and its sanctions.
(Bloomberg) — Drilling permits for new wells have spiked to unprecedented levels in the Permian Basin, signaling crude oil suppliers in America are finally responding to higher prices, according to Rystad Energy.
In March, a total of 904 horizontal drilling permits were awarded in the shale patch that lies beneath Texas and New Mexico leading to an all time high.
“This is a clear signal that operators in the basin are kicking into high gear on their development plans, positioning for a significant ramp-up of activity level,” Artem Abramov, Rystad Energy’s head of shale research, said in a note to clients. The move “foreshadows a significant increase in supply capacity from early 2023,” he added.
Further on in April, Bloomberg reported that Halliburton Co. said North American oil and natural gas drillers will lift spending by 35% this year, an increase from the biggest fracer’s pre-Russian war forecast.
The oilfield-services giant didn’t directly attribute the spending increase to fallout from Russian President Vladimir Putin’s assault on Ukraine but noted that explorers are pivoting to “short-cycle barrels.” Halliburton previously stated 2022 North American drilling-budget growth at 25% compared with last year.
Coming into May, rig prices are spiking in the U.S. promising profits at multi year high for oilfield contractors.
Three of the world’s biggest operators told investors that they’ve been able to rapidly raise prices in the U.S. compared to overseas.
“I don’t recall another period where leading-edge day rates for drilling rigs moved up this quickly,” Andy Hendricks, chief executive officer at Patterson, said on a call with analysts and investors. “The supply of high-quality equipment is now very limited.”
As news progresses we hope to continue covering it.