High oil and gas prices to linger, Bakken production to remain flat

Gas prices on February 24 compared to March 9 in North Dakota
Gas prices on February 24 compared to March 9 in North Dakota(KFYR)
Published: Mar. 9, 2022 at 5:40 PM CST
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WILLISTON, N.D. - It’s been 13 days since the Russian invasion of Ukraine officially began. Since then, oil and gas prices have reached historic highs, but what does that mean for the people and workers of the Bakken?

Russia is the third-largest oil producer in the world. With the United States and major oil companies imposing sanctions on the country, oil and gas prices will continue to climb worldwide.

Despite this, experts say don’t expect another oil boom here in the Bakken.

Economic sanctions have been imposed by various countries against Russia, and companies have followed. With the country being a top exporter of oil, there’s a large gap in inventory that is drastically affecting the markets.

“You have countries unwilling to buy from that supply, and so where do you fill that gap,” said David Law, Enverus analyst.

As the Biden Administration looks towards foreign markets as the answer, high prices at the pump will continue for the foreseeable future, but the ban will help slow the rate of increase.

“The good news is that pace of increase will now slow down. You shouldn’t have to worry about going outside and seeing prices up 40 cents a gallon,” said Patrick De Haan, head of petroleum analysis for GasBuddy.

Officials in North Dakota said production needs to ramp up at home. Unfortunately, it’s highly unlikely that will happen in the state.

“The issue with the Bakken is because it is a much more mature play, and the issue of both the quantity of the remaining inventory as well as the quality of that remaining inventory is in our opinion, the larger constraint within the play,” said Law.

Experts said diesel could continue to climb towards the $5 mark, while the national average for gasoline could reach $4.50 in the coming weeks.

Experts added the outlook for WTI going forward is to remain around $100 a barrel.

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