Oil Prices Surge 72% to $115 Spurs Shale Output, Chevron Flags Stockpile Risks
Crude oil prices have jumped 72% to around $115 a barrel since late February due to Middle East disruptions, prompting US shale drillers to accelerate production from drilled-but-uncompleted wells in regions like the Permian Basin. Chevron warns that depleting pre-war stockpiles could trigger further price spikes unpriced by investors.
1. Price Surge and Shale Response
Since the Feb. 28 attacks on Iran and the near-collapse of vessel traffic through the Strait of Hormuz, West Texas Intermediate crude has climbed from about $67 to $115 a barrel, a 72% increase that exceeds the $62–$70 breakeven range required for new US shale wells.
2. DUC Wells Driving Near-Term Production
Operators are planning to bring forward drilled-but-uncompleted wells in key regions such as the Permian Basin to capture elevated pricing, though full production gains may take up to nine months due to drilling, fracking and well-activation lead times.
3. Chevron’s Stockpile Risk Warning
Chevron executives caution that existing pre-war oil stockpiles are depleting rapidly, and further Middle East supply disruptions could ignite additional price spikes that the market has not yet factored into forward curves.