Moscow. November 17. Phenomenon of shale production in the US does not allow to predict oil prices in the world because it changes the situation on the market in the next few weeks, said the head of BP Russia David Campbell.
“Analysts have even called this oil (shale – if) toy, which in Russia is called “roly-poly”: you push her, she immediately comes back. And of course today it’s hard to predict what will be the price of oil, most likely oil production in the U.S. will grow, which complicates the task of OPEC in balancing the market,” he said,speaking at the conference “Exploration. Mining. Processing 2015”.
“OPEC will have to reckon with the Genie of technological progress, which took off from the bottle,” concluded Campbell.
He explained that, a technological breakthrough in the extraction of shale oil in the US happened due to the fact that the world price of oil rose to $100 a barrel. However, due to the lower cost of production, America was able to increase production even with falling world prices, caused, respectively, by the growth of shale oil production.
Experts estimate the cost of production of shale oil in the US $40-50 per barrel.
The head of BP in Russia, also noted that for the extraction of shale oil need fewer rigs than for extraction of conventional oil. At the same time, the market interpreted the reduction in the number of drilling rigs in 2015 compared with 2014 by 50% as a signal of reduced production in the United States, but, on the contrary, grows.
“Ruined another rule, said Campbell, is now the time between the adoption of investasinya and the extraction takes weeks, not years as before, so price elastic to changes in the cost of production”. The company has always invested a lot of money in production, and for long periods of time, so before the price was insensitive because of this time gap, shale oil is changing the market in a matter of weeks.