Oil-price gains will trigger a “significant” increase in U.S. shale output as OPEC and other producers rein in supply, according to the head of the International Energy Agency.
“U.S. shale-oil production will definitely react strongly,” Executive Director Fatih Birol said Wednesday in a Bloomberg Television interview in Davos, Switzerland. At $56 to $57 a barrel, “a lot of shale plays in the United States would make perfect sense to produce.”
Birol’s comments suggest that the IEA has become more optimistic about the outlook for U.S. production. Last month, the Paris-based agency said it expected U.S. tight oil — as shale is also known — to rise only “marginally” in 2017. The policy adviser to 29 nations will release its next short-term oil outlook on Thursday.
Source: Bloomberg (18 January 2017)