WTI Crude prices have recently surged to their highest level in three and a half years—just above $70 a barrel . In theory, that’s higher than the average breakeven costs of all key U.S. shale plays. Even $60 WTI is higher than the average breakeven prices, as per the latest quarterly Dallas Fed Energy Survey from March. Yet, U.S. shale producers are not necessarily raking in huge profits, although Q1 was their best start to a year in three years. Profits are constrained by pipeline bottlenecks in the Permian, higher costs for drilling services, some bad hedging bets capping part of company sales at below market prices, the huge discount of WTI Midland crude to WTI and Brent due to said bottlenecks amid soaring production, and investment in more drilling activity. U.S. shale producers face takeaway bottlenecks in the Permian, which is widening the WTI Midland crude discount to […]