In December Light Sweet Crude Futures on the Nymex went over $90/barrel. In late February oil prices went over $100. They have so far peaked at $114.83 in 2011, and have remained in a range between $95 and the high since. More specifically WTI averaged $79+ for all of 2010. It averaged approximately $98 for the first 4 months of 2011. Drilling for oil is profitable in most cases in the $30-$70/barrel range. With oil averaging almost $30 higher than the top of that range, the drilling business is getting a huge stimulus. Further there is political unrest in the Middle East and Africa. There is the increase in demand (not equaled by supply) due to increased oil use by emerging economies. Prices are more likely to go higher longer term than lower.
On top of this the biggest economy (the U.S.) with by far the biggest oil trade deficit has discovered many new prolific oil fields. The Bakken field and the Eagle Ford field are perhaps the most famous recent fields. However, the new Tuscaloosa Marine Shale field may contain tens of billions of barrels of oil. These could be tapped with the same horizontal drilling techniques that made booms of the Haynesville Shale, the Bakken, etc. Plus shale gas production has more than doubled in the last three years. To put some example numbers to it, permits for the Eagle Ford shale increased from 94 in 2009, to 1,010 in 2010. It is forecast to continue rapid growth along with the oil. Some estimate that oil service drillers will have to hire 19,000 workers this year alone to keep up with demand. In fact this boost in employment may stop new competitors from entering U.S. fields, and it may lead to potential mergers and acquisitions (good for acquired stock prices).
Source: Seeking Alpha
For Shale Plays and Shale Stocks
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