Here is one number to show
what a mega bubble the US Shale Bubble really is, and this number dates from september BEFORE the price of oil dived sharply starting october.
Yes, this means that shale oil frackers
only planned on financing 21% of their activities in 2019 from cashflow and that they intended to suck in almost 80% of their requirements from
muppets sophisticated investors. A traditional oil company finances everything from cashflow.


It would be no surprise then to find out that they already owe $0.25Tr to these
muppets sophisticated investors and due for repayment/refinancing in the next 5 years.
And nor would it be a surprise to know that paying interest on their existing loans costs 20% of cashflow already and that they are underwater in the 'Permian' shale in west Texas where transport costs to market are large. There are relatively few oil pipelines in the Permian, not enough for any expansion, and the amount of gas flared off there equals Irelands daily gas consumption alone....and no there are no gas pipelines in the Permian either.
This lunacy must come to an end, surely the
muppets sophisticated investors realise they will not get most of their money back even with Permian oil fetching $60 rather than the $40 they will often take for it today. $40 Permian means they cannot cover the interest on their loans.
We might see a bit of a pipeline bubble to finish this off before it all goes bang. And don't forget that more oil was thrown on the flames last month.
https://www.forbes.com/sites/arielcohen ... 23c27f2c91Quote:
America’s energy security just got a lot more secure. On November 28 The United States Geological Survey (USGS) published an assessment of continuous (unconventional or ‘tight’) resources in a part of the prolific Permian oil and gas basin that straddles Western Texas and Southeastern New Mexico. Located in the Wolfcamp Shale and overlying Bone Spring Formation, the unproven, technically recoverable reserves are officially the largest on the planet. But curiously this story isn't making waves in the mainstream media.
The USGS estimates that over 46 billion barrels of oil, 280 trillion cubic feet of gas, and 20 billion barrels of natural gas liquids are trapped in these low-permeability shale formations. To better understand just how staggering these numbers are, think about this: at the end of 2017, total U.S. proven reserves of crude oil hovered around 40 billion barrels. For natural gas, figures stood around 465 trillion cubic feet (tcf). The new upward revision of Permian resources represents a more than 100% and 65% increase in U.S. oil and gas reserves, respectively, if they can be extracted economically.
Too big an "if" for me though.
