Financial pressures confound shale oil and business failure increases with lower prices

Oil analysts have predicted that drilling rigs in the United States are likely to decline due to continued financial pressure on the shale oil industry, in light of lower prices and higher oil prices. escalating the trade war, highlighting the growing number of business bankruptcies in the current period.
This comes at a time when crude oil continues to decline as a result of the evolution of the US-China trade war, which has had a strong impact on prices, coupled with weak growth data. Korea and emerging markets, as well as a relative increase in the level of OPEC production last month.
Lower prices are holding back the continued membership of OPEC producers and non-OPEC countries in limiting oil supplies, as well as the collapse in oil production. Venezuela and Iran due to sanctions, in the prospect of a slowdown in US supplies.
He told Al-Eqtisadiah, specialists and analysts, "that demand is drawing attention to the oil markets because of the repercussions of the trade war, which has had a considerable impact on growth and created a climate of mistrust in the world. global economic performance, in addition to the impact of the US cyclone that caused the freeze refinery activity and low demand. "
John Hull, director of the international energy company Alfa Energy, said crude oil prices tended to record successive declines due to uncertainty and worries over major cracks in the global economy. , pointing out that oil prices were down 20% from the record level of 2019. Recorded end of April.
He said that everyone was now asking about the future price of oil, in light of the many factors that influence prices and trade flows, including the US-China trade dispute and the geopolitical tensions in the Middle East. East.
For his part, said Mufid Mandra, vice president of "Austrian LMF", the decline in oil prices could be the dominant feature of the market as part of the launch of a new phase of pricing by the beginning of the month .
He predicted that this would put financial pressure on the shale oil industry in the United States, limiting the growth prospects of the new platforms.
He pointed out that most speculation in favor of a slowdown in supply growth could exceed expectations, indicating the decline in US oil production last June, to 12.082 million barrels per day, according to new data released by the Energy Information Administration and at a remarkable pace compared to May In May, maintenance in the offshore oil fields has been at the origin of much of the drop.
"Uncertainties about economic growth and low prices create an unfavorable environment for new investment, a major challenge for a sector in search of popularity and continuity and which retains a key role in the global energy mix," said Andrei Yaniyev, analyst and energy specialist in Bulgaria.
He pointed out that signs of weak investment had been relatively restored, even though their pace was below that of the general slowdown observed in 2016, pointing out that US companies had begun to move away from oil prices. Oklahoma shale due to high costs and lower than expected production volumes. .
He said the latest EIA data suggest a decline in investment in Oklahoma, which could have a major impact on the sector.
Matthew Johnson, an analyst at Oxyra International, consultant, said the dominant market situation is that the oil sector is generally slowing due to current risks such as trade war, sanctions or geopolitical factors, which are holding back demand. Petroleum specialists will continue to see massive growth in their production this year until 2020, which requires more efforts to restore balance with the contributions of all producer-led parties.
He pointed out that producers, particularly US companies, were still under financial pressure, forcing platforms to slow down investment and reducing the number of platforms of 12 platforms over the next decade. the last week of August and an increase in the number of bankruptcies of US companies. .
In terms of price, oil fell by 2%, affected by the rise in crude oil production from OPEC and Russia, as well as by the long-standing trade dispute between the United States and China , which puts pressure on the global economy.
At 11:52 GMT, a barrel of US crude dropped $ 1.26, or 2.3%, to $ 53.84 a barrel, and Brent crude oil fell 96 cents to $ 57.70 a barrel.
The United States imposed 15% tariffs on a variety of Chinese products this week, and China has started to impose new duties on a $ 75 billion list of targeted products. Registering in the context of a trade war older than one year.
Despite escalating trade conflict, US President Donald Trump said: "The parties will meet later this month for talks".
At the same time, data from the central bank showed that South Korea's economy grew at a slower pace than expected in the second quarter, as exports were revised downward as a result of the dispute. between the United States and China.
Argentina's decision Sunday to impose capital controls also highlights emerging market risks.
The production of the Organization of Petroleum Exporting Countries (OPEC) increased in August for the first month of this year.
Russia's oil production in August reached 11.294 million bpd, exceeding Moscow's commitment under an agreement with other producers, reaching its highest level since March. , showed data.
In contrast, the OPEC crude basket fell to $ 58.76 a barrel on Monday, from $ 60.11 a barrel the day before.
The daily report of the Organization of Petroleum Exporting Countries "OPEC", "The price of the basket, which represents on average the prices of 14 crude produced by the production of the Organization of Petroleum Exporting Countries, has recorded a second consecutive decline, and the basket lost about a dollar from the same day last week, at $ 59.18 per barrel.