Insight
US Lower 48 oil outlook: diminished, not doomed
*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
We’ve recently downgraded our long-term forecast of US Lower 48 oil supply for the third consecutive time in the past two years. Last year took a massive toll on a sector already grappling with immense pressure from investors to change its growth-focused approach. But despite these challenges, we still foresee future growth for tight oil, albeit much less. In this Insight, we dissect our latest forecast to explain what drives that expectation for future growth and the factors that will limit it. Commodity price being a critical variable, we also explore the changes to tight oil’s trajectory under three flat price scenarios.
Table of contents
- With all the pressure on tight oil, how can it still grow?
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Three factors driving our downward revision
- 1) 2020’s activity collapse and checks on corporate spending extend the road to recovery
- 2) Challenges to the cost curve make growing even harder
- 3) Lower global oil demand: what does it mean for tight oil?
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Lower 48 scenarios: how price alters the trajectory
- Scenario 1: $30/bbl WTI flat
- Scenario 2: $50/bbl WTI flat
- Scenario 3: $70/bbl WTI flat
- Conclusion
Tables and charts
This report includes the following images and tables:
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Lower 48 oil production never recovers to its prior peak at $50 WTI long-term
What's included
This report contains:
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