Shares of energy producers rose alongside oil futures as concerns about over-supply faded. Russian oil output fell to the lowest level in 12 months in August, according to the International Energy Agency. It's unlikely that U.S. shale producers can sustain the rapid advances in reducing well-drilling costs over the last half-decade during the years to come, according to one brokerage. "Concerns that breakevens will be cut in half again look overdone," said analysts at brokerage Morgan Stanley, in a research note. "Since 2012, U.S. exploration-and-production corporate-level breakevens (the price for zero growth) have dropped from roughly $80 to roughly $43-per-barrel, while the average shale, single-well breakeven has dropped from roughly $75 to roughly $33-per-barrel. Cost deflation and increased well productivity from technology/efficiency improvements are the key drivers."
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(END) Dow Jones Newswires
September 13, 2017 16:24 ET (20:24 GMT)