Concerns about a tighter oil market as European Union members move closer to banning Russian oil overcame worries about the impact China’s COVID shutdowns could have on consumption.

This sent crude prices to six-week highs and they posted their first consecutive weekly gains in two months.

West Texas Intermediate, which has risen more than 40% this year, rose four out of five days on the New York Mercantile Exchange as Wednesday’s $5.40 jump outpaced Tuesday’s $2.76 decline. Prices added $1.51 on Friday to end the week at $109.77, down from $105.17 at Monday’s close to $104.69 at last Friday’s close. The list price closed the week at $106.25, according to Plains All American.

Natural gas prices also rose on four of five trading days, hitting 14-year highs and topping $8 per Mcf amid strong demand and forecasts of warm temperatures that will test the power grid. of Texas over the weekend. The biggest jump in commodity prices came on Tuesday when it rose 48 cents, followed by a jump of 46 cents on Wednesday and 37 cents on Thursday. Prices fell 7.4 cents on Friday to close at $8.043 per Mcf, from $7.475 at Monday’s close to $7.224 at last Friday’s close.

Elevation Resources has announced plans for several Barnett Shale wells in Andrews County’s Emma field. Steve Pruett, President and CEO, said high commodity prices have definitely improved the company’s bottom line.

“Our Barnett wells are initially 70-75% oil and the rest rich natural gas loaded with natural gas liquids,” he told The Reporter-Telegram via email. “Over time, the oil rate declines faster than the gas rate, so over the life of the well, 50% of our product on a Btu equivalent basis is oil. The faster oil decline as the reservoir decreases in pressure due to depletion is true for all oil reservoirs in the Wolfcamp/Spraberry/Bone Spring reservoirs of Delaware and the Midland Basin.

“Thus, the prices of natural gas and gas liquids affect the economic returns of drilling and completion investments in the Permian Basin. The importance of gas and NGL prices to our economy cannot be underestimated. In 2020, we realized negative residual (dry) gas prices and NGL prices of $10.23 per barrel. In the first quarter of this year, our realized residual gas price after processing fees and fuel deductions (paid to our gas buyer) was nearly $3.00 per Mcf, while our NGL prices net of processing and transportation costs were $39 per barrel.

“Overall, gas and NGL revenues made up 24% of our overall revenues, while oil sales made up the balance. In 2020, NGLs accounted for 14% of our revenues and oil the balance, as gas revenues were negative. »

He pointed out that the company’s costs had increased by 20 to 25%, but that margins had improved overall.

The Energy Information Administration released a report examining the financial results of 42 exploration and production companies and how rising crude prices helped them post strong increases in cash flow from operations and expenses. in capital in the fourth quarter of 2021.

The agency said cash from operations reached $27.5 billion in the quarter, the highest since the third quarter of 2014. Capital spending rose 60% to $15 billion from in the third quarter of 2021.

In the fourth quarter of 2021, the 42 publicly traded companies reviewed by the EIA collectively produced 3.8 million barrels of crude oil per day in the United States, or approximately 33% of total crude oil production in the United States. United.

The price of West Texas Intermediate crude oil averaged $77 per barrel (b) during the quarter, an increase of $35 per barrel or 82% from the fourth quarter of 2020.