Recent evidence points towards Permian oil companies and fracking to be overcapitalized and unprofitable

Investors and oil company leaders agree: fracking is in trouble. Adam Waterous, the owner and operator of Waterous Energy Fund, has said that the fracking business will peak in 2020. In addition to declining oil production, investors and oil companies are skeptical about financial sustainability. According to the evidence compiled by a wide variety of oil industry groups and business experts regarding Permian oil companies and fracking, the U.S. shale industry has become overcapitalized. This overcapitalization means that there is more debt acquired in fracking than companies have in assets and equity.

“We think we are at or near peak Permian,” said Waterous. “The North American oil market has been grossly overcapitalized, which is not sustainable.”

 Simon Casey, a Bloomberg reporter, agrees with Waterous’ assessment. “Predicting peak Permian output for 2020 isn’t a mainstream view. However, evidence is piling up that the U.S. shale industry may indeed be close to peaking as it runs out of the two things required to continue increasing oil production: money and what’s known as ‘tier one acreage.'” Tier one acreage is the highest-yielding area in an oil field, and it seems that the Permian region has less than was originally thought.

Now, an increasing number of Permian oil companies are going bankrupt and out of business because of their inability to produce a profit, and oil patches are providing less oil. As the trend continues, it becomes more evident that fracking is not profitable as it used to be, and methods of obtaining oil and energy need to change back towards a more generalist approach, according to DeSmogBlog[1].


  1. ^ according to DeSmogBlog (

Source URL: Read More
The public content above was dynamically discovered – by graded relevancy to this site’s keyword domain name. Such discovery was by systematic attempts to filter for “Creative Commons“ re-use licensing and/or by Press Release distributions. “Source URL” states the content’s owner and/or publisher. When possible, this site references the content above to generate its value-add, the dynamic sentimental analysis below, which allows us to research global sentiments across a multitude of topics related to this site’s specific keyword domain name. Additionally, when possible, this site references the content above to provide on-demand (multilingual) translations and/or to power its “Read Article to Me” feature, which reads the content aloud to visitors. Where applicable, this site also auto-generates a “References” section, which appends the content above by listing all mentioned links. Views expressed in the content above are solely those of the author(s). We do not endorse, offer to sell, promote, recommend, or, otherwise, make any statement about the content above. We reference the content above for your “reading” entertainment purposes only. Review “DMCA & Terms”, at the bottom of this site, for terms of your access and use as well as for applicable DMCA take-down request.

1 2