EconPapers    
Economics at your fingertips  
 

The Price Responsiveness of Shale Producers: Evidence From Micro Data

Knut Are Aastveit (), Hilde Bjørnland () and Thomas Gundersen

No No 05/2021, Working Papers from Centre for Applied Macro- and Petroleum economics (CAMP), BI Norwegian Business School

Abstract: Shale oil producers respond positively and significantly to favourable oil price signals. This finding is established using a novel proprietary data set consisting of more than 200,000 shale wells across ten U.S. states spanning almost two decades. We document large heterogeneity in the estimated responses across the various shale wells, suggesting that aggregation bias is an important issue for this kind of analysis. We find responses to be stronger for the largest oil producing firms, among wells that are spaced further apart and in regions where the density of shale wells is higher. The response also depend on the level of production. Our empirical results calls for new models that can account for a growing share of shale oil in the U.S., the inherent flexibility of shale extraction technology in production and the role of shale oil in transmitting oil price shocks to the U.S. economy.

Keywords: Oil price; Shale oil supply; Well-level panel data (search for similar items in EconPapers)
Pages: 31 pages
Date: 2021-09
New Economics Papers: this item is included in nep-ene and nep-isf
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://hdl.handle.net/11250/2777341

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bny:wpaper:0101

Access Statistics for this paper

More papers in Working Papers from Centre for Applied Macro- and Petroleum economics (CAMP), BI Norwegian Business School Contact information at EDIRC.
Bibliographic data for series maintained by Helene Olsen ().

 
Page updated 2022-05-24
Handle: RePEc:bny:wpaper:0101