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Image: Apache The cost of drilling for shale oil is dropping for the first time in about two years as demand for equipment and workers wavers. Prices for key oilfield inputs such as steel pipe and fracking crews are softening, according to executives from shale specialists such as Diamondback Energy Inc. and Marathon Oil Corp. The timing is problematic, however, after U.S. crude prices posted their worst start to the year since the lockdowns of early 2020, raising doubts about the wisdom of adding more oil supplies to global markets. Some of the price relief for shale-oil explorers has been driven by a deep depression in natural gas markets that is spurring companies to suspend or cancel drilling, freeing up rigs to migrate to more-profitable crude projects. “It is a cost deflation,” Diamondback CEO Travis Stice said this week, citing a $25-a-foot drop in the cost of steel pipe as an example. At the same time, oilfield-service providers like Halliburton Co. are pushing back, pledging to mothball equipment rather than see their fees shrink. Halliburton and fellow oilfield titan SLB have been among this year’s worst-performing energy stocks in the S&P 500 Index. “This is the first real test […]
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