Liam Denning, Columnist

Why Is Anyone Drilling Shale at All These Days?

Pushing more oil into a glutted market won’t help prices rise.

May 11, 2020 at 1:36 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.

The sun’s going down for shale.
Photographer: Spencer Platt/Getty Images North America

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Amid a historic oil crash, frackers are ditching rigs at a rapid pace. The number of operating horizontal rigs stood at 338 on Friday. That’s down more than half since February, though still above the trough in early 2016. So, churlish as it may seem, it must be asked: Why is anyone still drilling shale right now?

Speaking on an earnings call a month after petitioning the Texas Railroad Commission to impose supply cuts, Matt Gallagher, CEO of Parsley Energy Inc., summed up the situation facing frackers: