![]() It’s around 50%, whereas 10 or 15 years ago it was over 120% or 130% of free cash flow. The amount of free cash flow that US oil producers are reinvesting in capital expenditures is down materially. Rig counts are down from where they were at the end of 2022. We expect to see the level of growth moderating - but there still will be growth. Is US oil output likely to continue to climb? We spoke with Kiernan about the outlook for oil in 2024, her takeaways from the COP28 climate summit in Dubai, and how her clients view the oil market. Oil output cuts by some OPEC members, meanwhile, don’t appear to be as deep as feared. “Demand actually delivered, but the supply really outpaced it.” She points out that US producers aren’t reinvesting capital like they used to, but they’re still looking to grow. “Most of the focus, if you go back a year ago, was: soft landing or no soft landing? What would demand look like?” Kiernan says. The result has been softer oil prices, and that phenomena may continue in 2024, says Sarah Kiernan, head of Americas Commodities Sales in Global Banking & Markets at Goldman Sachs. While demand for crude oil held up over the past year, the growth in oil supply has been surprisingly robust. ![]()
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