Shale breakevens from the Dallas Federal Reserve Bank

By Staff | June 20, 2017

Kunal Patel is the oil and gas markets insights leader with the Federal Reserve Bank of Dallas. Patel spoke with us about his team’s efforts on an energy indicator report designed for individuals and entities in the Texas and New Mexico region, among others. Patel’s team has created an oil industry survey along with a slide deck that helps those in the region better understand the state of the energy industry.

While most questions coming into Patel’s team are general in nature—including what a DUC is—others are complex, including those on the factors that impact oil prices. Patel’s team also tracks indicators that help to illustrate the health of the energy industry, including housing vacancies, oil-related job hiring trends, and business transactions or plans of oil or gas companies.

One of the main data points the group provides is an updated breakeven price for oil producers in Texas and other regions across the U.S.

The survey of oil companies typically includes 200-plus respondents. According to Patel, individuals partake in the survey for one very important reason. “There are a variety of surveys out there that the Fed uses to understand business conditions,” he said. “This survey helps us make monetary decisions. By being a part of the process, it helps to inform our monetary policymaking.”

More information provided by the Federal Reserve Bank of Dallas can be found here: https://www.dallasfed.org/en/research/energy.aspx

According to the most recent data, breakeven prices for plays in the U.S. are as follows:

Permian (Midland): $46

SCOOP/STACK: $47

Eagle Ford: $48

Permian (Delaware): $48

Permian (Central Platform): $50

Other U.S. (shale): $55