Shale oil giants warn of oversupply, will cut spending and halt production growth plans.
One of the largest independent oil companies in the Permian Basin of the United States, Diamondback Energy, has warned that a large amount of oil supply will flood into the global market in the coming months. The company will cut $1 billion in capital expenditures, lower production guidance, and delay some fracking operations. CEO Vann Vang Hoff wrote in a letter to investors: "The expected growth in global oil supply in the second half of this year cannot be ignored. Therefore, we have prepared our business for the remainder of 2025, cutting expenses while maintaining oil production steady." This statement is in line with its forecast from May when Diamondback had said that U.S. shale oil production had peaked, and since then domestic crude oil drilling activities have decreased by 12%, hitting the lowest level in nearly four years.
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