Liam Denning, Columnist

The Oil Market Cannot Live by Shale Alone

Demand for expensive deep-sea reserves should rise, helping prices.

July 13, 2016 at 7:01 PM UTC

Liam Denning is a Bloomberg Opinion columnist covering energy. A former banker, he edited the Wall Street Journal’s Heard on the Street column and wrote the Financial Times’s Lex column.

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During the bull market in oil, it became fashionable to say something like "$100 is the new $20." These days, it's more common to hear "something less than $100 is the new $100."

Wood Mackenzie made its own contribution to the conversation with a new study released on Wednesday. The energy consultancy expects most of the oil projects currently planned over the next decade to be economic at oil prices of $60 a barrel or less. The bulk of those barrels are projected to come from shale deposits in the U.S., where costs have fallen rapidly in recent years. Here's the relevant slide from Wood MacKenzie's report ("Pre-FID" means projects yet to be approved with a final investment decision):