Wednesday, June 22, 2016

Mike Filloon's Tight Oil Update -- June 22, 2016

Summary:
  • Permian operators began hedging oil prices at $40/bbl and continue at $50/bbl with additional hedging from Eagle Ford names.
  • Increased volumes of hedging provide a short term ceiling to oil prices, at least until operators have enough revenues guaranteed to satisfy banks.
  • Given the large number of barrels unhedged through 2016 and into 2017, this could continue for a couple of months, but could take longer if oil prices pullback. 
There is a small amount of discussion regarding the Bakken in the Williston Basin. 

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