American shale oil is resisting Saudi Arabia's offensive better than expected. The overproduction imposed by Riyadh on the OPEC member countries, for the moment, is not bearing the hoped-for results and doubts are growing about the effectiveness of this strategy in King Salman's country. The goal was to bring down the prices per barrel to conquer global market shares, making the extraction of crude oil by competing countries uneconomical.
The first target in Arabia's sights was shale oil from the United States, i.e. crude oil obtained on American soil with the technique of hydraulic fracturing (or fracking).
And yet, despite the fact that both WTI and Brent prices have collapsed to just over 30 dollars, the bankruptcies of US companies that produce shale oil have been much less than many industry experts initially predicted.
Not only that: in several cases the resistance threshold would still be far away. According to a study published by some analysts, in at least 10 Texas counties the shale oil fields could continue to gain even with prices below 30 dollars.
In particular, in De Witt county, where about 100 barrels are produced per month, the break-even point below which extraction would begin to be uneconomical would be as low as $22,50 a barrel. In Reeves County, however, the bar would stop at $23, while the Ward sites would continue to produce profits up to a price of $25 a barrel.
As for the entire American panorama, practically all US producers would earn with oil above 60 dollars, but the rise in prices towards this threshold will not come soon. At the moment, the bearish phase continues.
