Energy Crash — 97% of Fracking Now Operating at a Loss at Current Oil Prices. This Could Be A Disaster In The Making. as oil prices went from $100 to $50. America’s 10 Largest Oil And Gas Companies Have Lost Over $200 Billion.

Submitted by IWB, on January 9th, 2015

If the Saudis wanted to crush America’s shale oil industry they are certainly doing a good job of it.

West Texas Intermediate reached a 2014 peak of $107.73 in June before dropping as low as $49.77 today on the New York Mercantile Exchange. The grade settled at $50.04 a barrel. That’s below the break-even price for 37 of 38 U.S. shale oilfields, according to Bloomberg New Energy Finance.

Shale oil fracking and Canadian tar sand is some of the most expensive (and dirty) oil production on the planet, while conventional Persian Gulf oil is the cheapest to produce.
Warren Henry, the spokesman for Continental, one of the frackers who have been spending money faster than they can make it, says that current oil prices are “not a sustainable long-term trend.”
However, Bob Tippee, Editor of Oil & Gas Journal, has a different take.

“The Saudis have no incentive to lower supply to defend the price of crude oil, that is kind of a given right now, so the Saudis are not going to rescue the market,” said Bob Tippee, Editor of Oil & Gas Journal.

It won’t come from other major producers either. Both Russia and Iraq have boosted oil production to their highest levels in decades.
So it seems certain that low oil prices are here to stay. At least for now.
And that’s bad for the oil patches of red states like Texas and North Dakota. Some are projecting 100,000 layoffs in the energy sector. Texas is certain to take some lumps.

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Big Oil loses $200 billion from oil price crash