2023-03-29 19:35:40 ET
U.S. oil and gas activity slowed substantially in Q1, as production gains stalled and sentiment turned pessimistic, according to a survey released Wednesday by the Federal Reserve Bank of Dallas.
The bank's business activity index, which measures conditions among oil and gas companies across Texas, Louisiana and New Mexico, plunged to 2.1 from 30.3 in Q4 2022.
Companies in the survey said costs rose for a ninth straight quarter and weaker prices for oil and gas were hurting cash flow and profits.
The average breakeven price across all respondents was $62/bbl, up more than 10% from the average in 2022.
The survey was conducted among 147 oil and gas firms during March 15-23, when oil prices were falling on concerns about the global banking industry; prices have climbed ~10% since then.
On Wednesday, front-month Nymex crude oil ( CL1:COM ) for May closed -0.3% to $72.97/bbl.
ETFs: ( NYSEARCA: USO ), ( UCO ), ( SCO ), ( DBO ), ( USL ), ( DRIP ), ( GUSH ), ( USOI ), ( NRGU )
The Energy Information Administration reported the largest weekly decline in crude inventories so far this year, falling by 7.5M barrels .
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Oil and gas drillers report sharp Q1 slowdown in growth, Dallas Fed survey says