Bud's Offshore Energy (BOE)

Consistent with our concerns about the lack of investment in offshore exploration and production, Aramco CEO Amin Nasser made this comment at CERAWeek in Houston:

“Today, we only have 2% of effective spare capacity, which is an imbalance,” Nasser said. “You need a resilient and strong spare capacity to make sure that you can absorb any supply shocks. Look at what’s happening. Before the Ukraine crisis, the spare capacity was declining fast.”

Oxy CEO Vicki Hollub’s comments further justify our concerns about US over-reliance on shale production. She noted these impediments to production growth in the Permian Basin, the world’s largest shale basin:

• Severe supply-chain constraints 
• Labor shortages
• Few already drilled wells ready to be completed
• Rig shortages