The recent oil price drop has rendered production in 19 shale areas in the U.S. unprofitable, according to a new analysis by Bloomberg. Those areas produce approximately 413,000 barrels per day. The shale areas identified by Bloomberg include the Eaglebine — located in east Texas — which has a break-even sales price of $86.35 per barrel. Also included is the Tuscaloosa Marine Shale, an area that stretches across central and southeast Louisiana and parts of Mississippi and requires $80 oil to turn a profit, and a patch of the Eagle Ford shale in south Texas.
West Texas Intermediate crude fell to a four-year low of $73.25 per barrel last week. Goldman Sachs estimates WTI will average $75 per barrel in the first quarter of 2015. Bloomberg’s report acknowledges a recent IHS forecast that 80% of the potential growth from shale oil drilling will remain economically viable at an oil price of $70 per barrel.
Government statistics show U.S. producers have added more than 1 million barrels per day of production in the past year. The growth in U.S. oil production has been a key factor in the global oil price slump.
SEE ALSO: Texas led nation in oil and gas job growth in 2013
