| Oil bulls pinning their hopes on tumbleweeds in East Texas may now be peering further south. The argument for oil rebounding after last year’s crash rests largely on cash flow-constrained shale drillers in Texas and other states downing tools. The roughly 30% rally since mid-March in front-month oil futures, to almost $60 a barrel, has mirrored a falling rig count.
To date, though, actual U.S. oil output doesn’t appear to have dropped markedly. Indeed, the latest Energy Department estimates indicate production hitting its highest in decades. Those data are far from perfect. But alongside rig counts that have suddenly stopped falling, they suggest U.S. output is proving resilient so far........................................Full Article: Source
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