Kansas Fed: Q2 Oil, Gas Activity Declines in U.S. Rockies and Midwest, Rebound Expected
(Reuters) — Oil and gas activity in the U.S. Midwest and Rockies declined during the second quarter, but is expected to rebound over the next six months, the Federal Reserve Bank of Kansas City said on Friday in a quarterly energy survey.
The survey covers companies drilling in Kansas, Colorado, Nebraska, Oklahoma and the northern half of New Mexico.
Oil firms operating in those regions on average make a profit at $64 a barrel oil, according to the survey, but need prices to rise to $91 a barrel to substantially increase drilling.
Benchmark West Texas Intermediate futures are currently trading around $82.50 a barrel CLc1.
Gas prices need to be $3.47 per million British thermal units to drill profitably and $4.68 per million Btu to increase activity, participants said. Henry Hub futures are currently around $2.334 per mmBtu.
"Gas prices in the Rockies are so low, we're shutting in production," said one unnamed survey respondent.
Another said their firm was also planning to reduce output due to historically low natural gas prices.
Some 43% of respondents said increased regulations posed the greatest risk to their businesses over the next year, while 29% said slowing economic activity would be the biggest threat. Another 25% said decisions by OPEC+ on production were the greatest risk.
Related News
Related News
- Trump Aims to Revive 1,200-Mile Keystone XL Pipeline Despite Major Challenges
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
- ConocoPhillips Eyes Sale of $1 Billion Permian Assets Amid Marathon Acquisition
- ONEOK Agrees to Sell Interstate Gas Pipelines to DT Midstream for $1.2 Billion
- Energy Transfer Reaches FID on $2.7 Billion, 2.2 Bcf/d Permian Pipeline
- U.S. LNG Export Growth Faces Uncertainty as Trump’s Tariff Proposal Looms, Analysts Say
- Tullow Oil on Track to Deliver $600 Million Free Cash Flow Over Next 2 Years
- Energy Transfer Reaches FID on $2.7 Billion, 2.2 Bcf/d Permian Pipeline
- GOP Lawmakers Slam New York for Blocking $500 Million Pipeline Project
- Texas Oil Company Challenges $250 Million Insurance Collateral Demand for Pipeline, Offshore Operations
Comments