This Could Be When Shale Driller Discipline Cracks, Citi Warns

Oil executives tempted by the prospect of the highest crude prices in seven years are showing all the signs of abandoning pledges to hold the line on drilling budgets, Citigroup Inc. said.

U.S. shale explorers are poised to boost spending by almost 40% this year, based on comments and plans revealed during recent earnings presentations, Citi analyst Scott Gruber wrote in a note to investors on Monday. That’s up from the bank’s previous call for a 30% rise. Overseas budgets are seen jumping by 32% from the old forecast of 17%.