IEA Sees U.S. Shale Oil Shrinking in 2016 on Price Slump
- Supply set to fall by almost 400,000 barrels a day next year
- Prices below $50 a barrel are halting drilling activity
Cheap Oil: The Good and Bad for the United States
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U.S. shale oil production will drop 9 percent next year as a crude price below $50 a barrel “slams brakes” on years of supply growth, the International Energy Agency said.
“Oil’s downward spiral to fresh six-year lows below $50 a barrel has dimmed the prospects for a recovery in U.S. drilling activity,” the Paris-based IEA said in its monthly market report Friday. Unless oil prices “bounce back in coming months,” supply is forecast to fall by 385,000 barrels a day next year to 3.9 million barrels a day.