U.S. oil producers are betting that crude prices will stay low well into next year, hedging some of their production at around $40 a barrel in 2021.
Exploration and production companies have so far hedged 41 percent of their forecast 2021 oil output at an average West Texas Intermediate price of $42 a barrel, 25 percent lower than this year’s hedged price floor of $56 per barrel, according to Rystad. The hedge is in line with current crude prices, which are hovering around $39 a barrel as of Tuesday morning.
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