re: Oil stocks, oversupply and the Iran deal

quote:

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My impression is that we are going to continue to see downward pressure as a result of storage capacity constraints as well as persistently growing production, and one thing people kind of overlook, a strengthening dollar. The question now is to what extent those developments are offset by a sharp drop in drilling, as we are now approaching a 50% decline in US oil-focused land rig count In 5 months.

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I think the x factor could be interest rates. If rates start to tick upwards, a lot of these marginal shale players will die quickly and supply will drop.

I also don't see how this trend of delayed well completion will continue for very long. I don't think it matters how cheap drilling gets, that is pure expense with no revenue. Bankers, and investors, won't support that.