When it published the results of its Q2 survey of energy executives, the Federal Reserve Bank of Dallas included a comment from one oil and gas exec that defines the overall effect of the shale boom on global oil prices:

“The exploration and production industry needs to get used to the paradigm that oil prices will be set for the next several years by the breakeven prices needed to drill Permian basin shale wells because there is a lot of tiger in this tank!”

It’s a telling comment. For one thing it confirms that U.S. oil right now is all...


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