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

- Enbridge Plans 86-Mile Pipeline Expansion, Bringing 850 Workers to Northern B.C.
- Intensity, Rainbow Energy to Build 344-Mile Gas Pipeline Across North Dakota
- U.S. Moves to Block Enterprise Products’ Exports to China Over Security Risk
- 208-Mile Mississippi-to-Alabama Gas Pipeline Moves Into FERC Review
- Court Ruling Allows MVP’s $500 Million Southgate Pipeline Extension to Proceed
- U.S. Pipeline Expansion to Add 99 Bcf/d, Mostly for LNG Export, Report Finds
- A Systematic Approach To Ensuring Pipeline Integrity
- 275-Mile Texas-to-Oklahoma Gas Pipeline Enters Open Season
- LNG Canada Start-Up Fails to Lift Gas Prices Amid Supply Glut
- Kinder Morgan Gas Volumes Climb as Power, LNG Demand Boost Pipeline Business
Comments