Exclusives / Features | Hedging | Capital Markets | Oil & Gas Prices
The Oil Price War Begins
Print
|
Oil prices fell this weekend from Friday's lows of $43 WTI to $32 WTI (early morning trading) - a decrease of 26%.
This is in large part to Russia's decision last Friday to not support OPEC's 1.5 million barrel per day oil production (mmbbls/d).
Let's revisit what happened over the last month:
- 2/10/2020: Even as the Coronavirus decimated oil demand, U.S. E&Ps guided that they plan on growing light oil by +8% (roughly 600,000 - 700,000 barrels per day).
- 2/28/2020: U.S. places sanctions on Rosneft over alleged Venezuela oil exports.
- 3/6/2020: Russia says no to OPEC's proposed 1.5 MMbbl/d cut and oil falls to $43.
- 3/7/2020: Saudi Arabia cuts April crude oil prices
- 3/9/2020: Crude oil falls (-23%) from Friday close to $32 by Sunday.
U.S. E&Ps Already Responding to $30s WTI
This morning, a large Permian E&P said it plans to cut it rig count from 21 to 18 and reduced it frac fleets to 6 from the 9.
We expect more companies to respond by cutting drilling and completion programs over the next few days / weeks.
Eyes are on companies like EOG Resources, who has no hedges in place and is currently operating 31 rigs, and plans to grow oil (+10%).
Centennial Resources and Continental Resources, who both operate 6 & 18 rigs, respectively, will also have to reduce activity significantly as well.
More Geopolitics News
Venezuela: Rebuild Potential vs. Stop/Start Reality — What It Means for International OFS
Venezuela: Rebuild Potential vs. Stop/Start Reality — What It Means for International OFS According to Reuters, Venezuela’s oil sector remains a high-potential but fragile opportunity: it holds massive…
OPEC+ Nudges Supply Higher: Why This Weekend’s Hike Echoes 2020—But Isn’t 2020
OPEC+ ministers met this past weekend and agreed to raise collective output by roughly 137,000 barrels per day starting in October. It’s the latest in a sequence of…
Chairman of Russia's Lukoil Dead After 'Fall from Hospital Window'
Lukoil Chairman Ravil Maganov has died, according to multiple reports. He was 67. Russian state-owned news agency TASS reported that Maganov died following a "fall from a hospital…
Biden to Release One Million BPD from Reserves for Six Months; Push for Federal Leasehold Production
The White House and President Joe Biden have announced that they will be releasing one million barrels per day from the US' Strategic Petroleum Reserves in order to…
Energy Firms Exit Russian Projects En Masse, Citing Ukraine Invasion (Updated 3/4/22)
This week, several energy companies have announced that they will be abandoning projects tied with Russia in protest of the country's invasion of Ukraine. Several other firms who…
United States News
A Quiet Capital Pattern Is Forming in North American Upstream — and Almost No One Is Talking About It
A handful of recent transactions and capital raises point to a subtle pattern in North American upstream—one that is easy to miss because each event, on its own,…
EIA’s “Glut” Calls: The 2025 Surplus Claim — and How 2021–2024 Forecasts Actually Held Up
The “~2.2 MMb/d glut in 2025” framing traces to the EIA’s Short-Term Energy Outlook (STEO), December 2025. EIA doesn’t usually write “glut” in the tables—what they publish is…
New E&P Scores Capital; Heading To the MidCon Region
Company Overview 406 Energy, LLC is a newly formed, Houston-based upstream oil & gas development company launched in October 2025 with an initial equity commitment from NGP Natural…
2025 Forecast : Dangerous Time Ahead
This is the time of year when we share a clear view into how we’re thinking about what to expect for drilling and completion activity in 2025. To…
Petrus Resources Ltd. First Quarter 2023 Results
Petrus Resources Ltd. announced first quarter 2023 results. Highlights Higher production – Production was up 54% from 7,379 boe/d(1) in the first quarter of 2022 to 11,385 boe/d…