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US Shale Producers Cut Extraction of Oil, Gas Amid Market Oversupply

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Some of the largest US shale producers have started to reduce oil and gas extraction for the first time in years amid global low prices and oversupply of the raw materials, US media reported.

MOSCOW (Sputnik) — According to The Wall Street Journal, companies announced the reduction in extraction after publishing their yearly accountability reports, indicating a decline in profits.

Devon Energy and Marathon Oil Corp. reportedly intend to reduce production by 10 percent in 2016 compared to 2015, while EOG Resources Inc. plans to cut extraction by 5 percent.

According to the newspaper, Continental Petroleum Corp. plans to drill several new wells, but will not use most of them this year.

The policy of cutting production stands in stark contrast to the past year, when producers kept pumping oil and gas despite prices continuing to plunge, the article noted.

Earlier in February, Saudi Arabia, Russia, Qatar and Venezuela signed the so-called Doha deal to freeze oil output at January levels throughout 2016. Doha participants have urged all oil producers, both members of the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC states, to join the deal.

So far, the agreement has been endorsed by Iran, Ecuador, Algeria, Nigeria and non-OPEC member Oman.

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shale gas, oil and gas, United States
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