“Efficiency” is being stressed this week by oil company leaders. They worry about how too much of a good thing could turn out bad. What were are talking about is too much production.

From Exxon Mobil’s (NYSE:XOM) Darren Woods to Statoil’s (NYSE:STO) Eldar Saetre, nearly every executive talked about lower breakeven prices; for some new projects tying back to existing facilities, execs said they could avoid losses at as low as $12/bbl.

Wael Sawan, the head of Shell’s (RDS.A, RDS.B) deepwater business, said the company had cut the cost of its wells by 50% over two years, mostly because it now uses four standard well designs worldwide vs. dozens previously.

With costs down, companies are starting to approve more investment: Bob Dudley said BP would bring on more projects this year than ever, Total (NYSE:TOT) CEO Patrick Pouyanne said his company plans to approve as many as 10 big projects in the next 18 months, and shale firms such as EOG Resources (NYSE:EOG) and RSP Permian (NYSE:RSPP) said they expected to boost annual production by 20%-30% over several years.

Amid all the optimism came some warnings: Pioneer Natural Resources’ (NYSE:PXD) Scott Sheffield said prices could fall to $40/bbl if OPEC fails to extend its output agreement, and Continental Resources (NYSE:CLR) CEO Harold Hamm warned that undisciplined growth could “kill” the oil market.

Please Like And Share Our Content!