Hughes quoted in Tyee article on crashing oil prices
March 31, 2020
Post Carbon Fellow David Hughes was quoted in this article on the threat to shale oil posed by crashing oil prices.
From the article:
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David Hughes, an independent energy analyst, told the Tyee that companies such as Suncor who have paid off their initial investments and own their own upgraders and refineries, could survive prices as low as $20.
After the 2014 price collapse the oil sands industry, dominated by five major companies, retrenched and became much leaner. It reduced costs, automated jobs and cut stuff.
Most the industry can survive the downturn provided it does not last more than a couple of months said Hughes.
But the shale frackers operating in Alberta and B.C. already are in trouble due to high costs, low returns and crippling debt.
“They need prices about $50 a barrel to break even,” said Hughes.
“The coronavirus is a wild card. A train wreck is certainly shaping up,” added Hughes.