The roller coaster ride that was 2008 has left the E&P industry shaken by fluctuating prices, a global credit crunch and an unpredictable political landscape. Yet opportunities abound amid the uncertainty.
Edited by David Michael Cohen, Managing Editor
The rapid rise, then fall of crude oil prices, the global credit crisis, the expiration after 26 years of the US offshore drilling ban, and sweeping Democratic presidential and congressional victories in the US make predicting industry developments in 2009 extremely difficult. As one of our E&P experts said with regard to oil and gas prices, if you hear a prediction, “immediately grab your wallet and run for the door.”
Our industry experts see great opportunities opening up with the end of moratoria on development of the Outer Continental Shelf, but urge immediate and sustained lobbying and public education efforts to avoid reinstitution of the ban by the new Democratic US Congress and president. Other possible US legislation that could impact the industry includes higher royalties and the imposition of a carbon-trading regime.
While E&P projects that were economic at $50-$60 oil in 2007 shouldn’t be any less feasible at that price in 2009 - since that was the price budgeted for - nevertheless the tightening global credit market is causing many operators to back off of planned development projects, which may well cause a supply shortfall as depletion outpaces investment in mature fields. As one of our experts argues, it would be a grave mistake for the industry to abandon drilling and production optimization technologies in the face of economic uncertainty. 
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