Crude production close to maximum

The US shale industry has warned it cannot rescue Europe with increased oil and gas supplies this winter amid fears that a plunge in Russian exports will send crude prices soaring back above $100 a barrel. « Our production is what it is,» said Wil VanLoh, head of private equity group Quantum Energy Partners, one of the shale patch’s biggest investors. «We’re not adding rigs and I don’t see anyone else adding rigs,» said Sheffield, who runs one of the biggest oil producers in the US. Crude prices could rise above $120 a barrel this winter as supplies tighten, Sheffield added.

The International Energy Agency said yesterday that oil sales from Russia, the world’s biggest petroleum exporter, could fall by almost 20 per cent when the EU embargo takes full effect. Brent crude prices rose 3 per cent to $94 a barrel following the report. Soaring shale production in the past decade made the US the world’s biggest oil producer, with pre-pandemic output hitting 13mn b/d, or more than 10 per cent of global supply. Shale output growth each year in the boom years on its own met the rise in global demand, helping to keep a lid on crude prices.

New concerns about shale’s sluggish supply growth come as traders also grow anxious about the Opec producer group’s ability to raise supply. Modest supply rises from the US in coming months wouldn't move things at a world scale», said Matt Gallagher, head of Greenlake Energy Ventures.

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