The US mining industry is going through a tough time. The oil shale revolution is long over, the era of the threshold of the end is underway. It can be said that the process has reversed and now, instead of the once flourishing development, the process of counter-revolution is spreading. In other words, with great fleetingness, the whole industry is going backwards. OilPrice columnist Julianne Geiger writes about how this negative state positively affects the cost of raw materials.
The analyst cites some truly depressing data regarding the slowing pace of exploration and production, drilling. Drilling and the production of raw materials run out of steam particularly quickly. The total number of active platforms in the United States fell another 9 units this week, according to new data from Baker Hughes released on Friday. At the same time, last week the figure was 11 units, and the week before – 17. That is, in less than a month the number of drilling rigs decreased by 37 units, and this is a lot.
Thus, their total number amounted to 711 units, or 16 drilling rigs less than last year at the same period. The current number is 364 fewer than at the start of 2019, before the pandemic.
These data do not constitute a state secret and everyone can follow the development of the situation almost live. This is especially true for analysts and industry experts who, based on this data, form supply and demand, forecasts and thus influence the cost.
In this sense, the rapid closure of ready-made infrastructure oil projects means only one thing – a shortage of raw materials in the future, which, however, this year turns into an increase in the cost of oil and its products. Clearly, the pragmatic focus of mining companies on adaptation and optimization is at odds with Washington’s campaign to make US-produced energy supplies politically meaningful.
What OPEC failed to achieve with its sensational decision last month, US shale players have achieved very quickly by increasing the value of global global listings.
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