The breakeven cost of producing oil from U.S. shale is roughly the same as non-shale, despite the tidal wave of investment into the sector. According to the Federal Reserve Bank of Dallas, the breakeven prices for producing oil in the Delaware Basin is $49 per barrel and $48 per barrel in the Midland Basin, both of which are in the Permian. Meanwhile, what the Dallas Fed classifies as “other U.S. nonshale” has a breakeven of $49 per barrel. So, despite all the hype, shale is not more competitive on a cost basis than conventional and offshore production. Notably, the breakeven price for the Permian outside of the Midland and Delaware basins is $54 per barrel on average. The Eagle Ford sits at $51, and the SCOOP/STACK in Oklahoma at $53. Get an unfair advantage in energy markets With secret intel once reserved for the world’s most elite traders Learn […]