US shale oil production likely to fall further in January

The oil prices dropped yesterday after OPEC refrained from cutting down the production on Friday, along with other reasons like USD strength, declining US equity markets and the prices that dropped below key support levels.

Both the Brent and the WTI price declined by over 5% and are trading close to the lows they recorded during the 2008/09 economic crisis. 

This fall in oil prices should support OPEC in reaching its "new challenge", to slow non-OPEC production, and to force more producers in US for example, to their knees in short term.

US Energy Information Administration (EIA) anticipated that US shale oil production will dip below 4.9mn barrels per day in January 2016, in its short term drilling productivity report.

"According to the EIA, output still totalled nearly 5.3 million barrels per day in May. According to Baker Hughes, meanwhile, the oil rig count in the US fell last week for the 13th time in the last 14 weeks and is currently at a mere 545, its lowest level since May 2010", noted Commerzbank.