US$60 is the new US$50 for oil drillers in US waiting for rebound
Despite higher prices and lower costs, industry raises the bar for resuming drilling because it wants prices to be sustained
New York
EARLIER this year, oil and natural gas companies facing the worst slump in a generation said they would need crude to reach US$50 a barrel before resuming drilling. Last week, despite higher prices and lower costs, the industry raised the bar, signalling it will take US$60 or better before meaningful production can resume.
"The industry doesn't want to ramp things up until they are fairly confident prices will hold up," said Brian Youngberg, an energy analyst at Edward Jones in St Louis, in an interview. "I think the industry has learned that it needs to get away from this boom-bust scenario."
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