WHAT MATTERS IS THE NET PROFIT PER BARREL OF OIL

We have read in many written article how US shale oil companies are revolutionising the extraction of tight oil plays. Despite the continuing slump in oil price, many of the major shale oil companies touted how they are improving the productivity per rig, the efficiency in drilling techniques which reduce the number of man days, and how technology improved the the overall cost structure.

But are these new found ways improving the net profit per barrel of oil? Are they cash flow positive or negative. Even when oil was trading at more than US$100 many of these companies were hardly generating positive cashflows. So how would they fare at today's oil price?

This article offers an insightful view of how shale oil companies could be in deeper trouble than what the analysts and oil barons say.

Link: http://oilprice.com/Energy/Crude-Oil/The-Biggest-Red-Herring-In-US-Shale.html