Around 41pc of forecast US E&P production has so far been hedged in 2021
Conservative hedging bruises US shale
Operator balance sheets are benefitting from the uplift in oil prices, but many could miss out as the bulk of their production is locked into more muted pricing
Results season painted a cheerier picture for much of the US shale patch in Q1, with revenues rebounding as WTI comfortably surpassed $50/bl. But while many operators boasted stronger cash flow and debt reduction during the quarter, cautious hedging could see the sector miss out on billions of dollars. Around 41pc of forecast US E&P production has so far been hedged in 2021, estimates consultancy Rystad Energy. And the average floor price of $42/bl is significantly less than the $65/bl WTI average in April. Houston-based consultancy Opportune surveyed the 30 largest public oil and gas companies operating across the US shale patch. Of the 27 that disclosed hedging, average crude swap pric
Also in this section
30 May 2025
Energy majors argue transition debate has started to factor in the complexities of demand shifts and the wider role for gas
29 May 2025
Sovereignty is the watchword for the new government, but there are still upstream opportunities for those willing to work closely with the state
29 May 2025
A cautious approach to coal-to-gas switching offers lessons to others who are looking to balance cost with cleaner energy
28 May 2025
The country may have the resources, but sanctions and a lack of market access make its gas ambitions look very questionable
