Let’s look at last week’s key figures for the oil & gas industry. U.S. oil production is slightly up, whereas oil futures have been trading lower. Gasoline prices continue their trend downwards.
Friday, December 6, 2015 WTI closed at $39.97, down $1.11 for the week.
Friday OPEC’s meeting in Vienna did not give oil markets any relief. There was little expectation of an agreement on production cuts, despite the majority of OPEC members pleading with Saudi Arabia to reverse course and cut back the cartel’s output target level, which stood at 30 million barrels per day (mb/d) heading into the meeting.
In summary, here we are a year after Saudi Arabia decided to keep market share rather than cutting production to support pricing. That decision combined with the U.S. shale industry keeping production levels up has precipitated in a nearly 50% drop in oil prices from a year ago.
Source: OPEC Won’t Cut, Markets Remain Oversupplied, OilPrice.com by Evan Kelly, December 4, 2015