“Over the long run the easing of sanctions against Iran spells trouble for the economics of the tight oil plays that have sprung up across the United States in recent years. The Eagle Ford and Permian Basin and Bakken fields need sustained high oil prices to make the economics of expensive drilling and steep decline rates pay off.”
Horsesh!t. This American oil boom hasn’t affected the price of oil one iota.
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True. What the writer is saying is that Iranian production will add more supply on top the the supply that US fracking is adding.
More supply will lower prices. The Iranians think that higher supply might lower oil prices enough to choke off the US shale oil fracking revolution which requires oil to be at least $60 a barrel for the best drillers and $80 a barrel for the not so good drillers.
They’re ignoring the oil that’s a byproduct of natural gas drilling. Especially the wells that produce the higher profit wet components such as propane, butane, ethane, etc. The crude oil is being removed by collection services once the holding tanks near the well head are full. That oil production is not related to market price. It’s a bonus in a sense.