Svetlana Doh, Oil & Gas Analyst at GlobalData, comments: “Production in the Permian Basin peaked in December 2019 and the upswing continued during Q1 2020. Since then, however, it started tapering off due to the global ‘demand crash’ caused by the COVID-19 outbreak. The ease of restrictions and travel bans during H1 2021 have improved the demand prospects, encouraging production activities in the basin.”
However, steady production growth along with positive investment outlook has set the expectation of production reaching to the pre-pandemic levels by 2022 after recovering completely.
“Despite West Texas Intermediate (WTI) price rebounding to the pre-pandemic levels, rigs are still slow in catching up. Permian Basin rig count dropped to its lowest point in August 2020 at 117 rigs. Since September 2020, the basin has seen a slow increase in rig count, about 7%. As of June 2021, there were 235 rigs operating in the Permian Basin compared to only 135 rigs a year ago in June 2020. GlobalData expects oil and gas companies to refocus on their core assets in the Permian Basin and ramp up the drilling and completion activities.” Ms Doh concluded.
This article was originally posted at sweetcrudereports.com