Macro
Matador Resources exceeds Q1 2024 oil production targets by 2%, underscoring US shale's impact on global oil markets.
By Bill Bullington
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Matador Resources Co. has outperformed expectations in oil production during the first quarter of 2024, delivering a notable 2% increase over its projected output. This achievement is particularly significant as it comes at a time when the majority of US producers have committed to maintaining flat or only moderately increasing their production levels throughout the year. The Dallas-based company reported an average oil production of 84,777 barrels per day, surpassing its guidance of 83,500 barrels. This success is attributed to better-than-expected well performance in New Mexico's section of the Permian Basin, which borders Texas.
The unexpected increase in output from US shale producers, including Matador, has positioned the United States as the world's leading oil producer. This surge in production has played a crucial role in stabilizing oil prices, especially in light of production cuts from the OPEC+ alliance. The US's ability to exceed production expectations in 2023 and continue this trend into 2024 has significant implications for global oil markets, contributing to a more balanced supply and potentially moderating price volatility.
Not only has Matador Resources Co. exceeded its production targets, but it has also achieved this feat while spending less on drilling than initially budgeted. This financial efficiency underscores the company's ability to optimize its operations and maximize output without proportional increases in expenditure. Such performance is indicative of a broader trend among US shale producers, who are increasingly focusing on capital discipline and operational efficiency to enhance profitability and shareholder value.
"We now expect full-year production for 2024 at the high end of our previously announced average production guidance for oil of 91,000 to 95,000 barrels of oil per day."
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