Oslo-based Rystad Energy said May 15 that starts of new hydraulic fracturing jobs in U.S. will hit a low in May before a recovery begins in 2020Q3. Rystad said, “The covid-19 pandemic and the low oil price environment it has created continue to affect global energy markets and activity levels by oil and gas producers.” Rystad estimates starts of new hydraulic fracturing in May will total about 300 to 330 wells – down from 337 in April, 877 in March, and a 2020 high of 1,238 in February. The May forecast includes an estimated 124 wells in Permian Basin.
Artem Abramov, who directs Rystad’s shale research, said, “Our most recent conversations with suppliers, service providers and E&Ps indicate that we will probably see activity stay at the current low level for the rest of the second quarter. A modest recovery is expected in 2020Q3, but stable WTI prices in the low- to mid-$30s are required to see this recovery in selected core acreage positions operated by producers with strong balance sheets.”