Based on the low price of natural gas, many companies have been switching their drilling operations from targeting natural gas to drilling plans that are heavier on crude oil. This is evident in the fact that the quantity of land rigs drilling for natural gas has reached the lowest point since May of 1999. Meanwhile, oil rigs are at a 12-week high at the moment. As this production of natural gas begins to wane, demand and supply could approach a better balance, which should help the price return to a profitable level for the key players in the industry.
Another area of flux is the way in which companies in the midcontinent plays, like the Bakken Shale, are transporting the crude oil once it has been pumped from the ground. Pipelines have been all the rage over the last few years, but due to the amount of time it takes to construct them, and the amount of political red tape companies must deal with, railroads have been taking a bite out of the market share. Better access to the West Coast and Canada are also both prime reasons why this transport via rail could continue.
