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Oil prices could hit $150 a barrel unless the US boosts exploration, a top shale executive warned.
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Production could peak in the Permian Basin, said the Continental Resources CEO.
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Other US market commentators have flagged rising oil prices as a major concern for the economy.
Oil prices could be headed as high as $150 a barrel unless the US boosts its exploration efforts, a top shale executive warned.
Once crude oil output in the Permian Basin peaks with no new sources coming online, then a supply squeeze could see “$120 to $150” oil, Continental Resources CEO Doug Lawler told Bloomberg TV on Monday.
“That’s going to send a shock through the system,” he warned on the sidelines of the American Energy Security Summit in Oklahoma City. Unless new drilling can begin, “you’re going to see more pressure on price.”
US crude oil currently hovers around the $90 mark as OPEC+ production cuts have triggered a steep rally in recent months.
For now, domestic oil production is seen remaining robust, with Rystad Energy estimating fourth-quarter output at 13 million barrels per day, and the IEA seeing the US as leading non-OPEC+ production growth over the coming years.
Still, some US market commentators have flagged rising prices as a major concern for the economy, with fuel costs adding to inflationary pressure.
JPMorgan warned last week that oil prices could soar back into the triple-digits if supply is put under any more pressure and that oil at $120 a barrel would have dire consequences.
“We estimate that if this were to happen in the coming weeks and were attributable entirely to supply cuts, the global economy would slow to a near stall next quarter,” they said.
Read the original article on Business Insider