Drilling Boom in Hottest U.S. Oil Play Is Bad News for Gas Bulls
A drilling surge in America’s hottest oil play may prove to be a pitfall for natural gas bulls.
As explorers extract crude from the Permian shale in West Texas, they’re also producing gas. A jump in the number of rigs operating in the basin is adding to the so-called fracklog, or the number of drilled wells that are waiting to be connected. That’s a sign that gas output from the region will jump by about 25 percent over the next year, threatening to send prices below $2 per million British thermal units, according to Tudor Pickering Holt & Co.
Written by Naureen Malik for Bloomberg.com