North American oil explorers have only hedged about 11 percent of their oil production in 2016. That’s well below the 28 percent of oil production they’ve hedged in the third quarter of this year and , according to research firm IHS.
Government analysts say shale oil fields in Texas, Colorado, North Dakota and Ohio are set to decline by 80,000 barrels a day this month, bringing their combined daily output to 5.2 million barrels in October.
The report from the U.S. Energy Information Administration noted that the last time prices were these low was 2004. The price of a regular gallon of gasoline is down 95 cents from the same time in 2014.
U.S. benchmark oil futures had opened lower on the day but traded to a gain shortly before the report was released. After the inventory data came in, prices reversed course and fell by 98 cents or 2.16 percent to $44.43 per barrel.
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