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Clarksons Platou: Oil at USD 40 will shut down North Sea fields

The smaller North Sea rigs, who only have a few years left anyway, look set to be shut down ahead of schedule if the oil price remains at around USD 40, says Clarksons Platou analyst in an interview with ShippingWatch.

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Smaller production units in the North Sea and on the UK shelf, with break even levels of around USD 70 per barrel, and which are far along in their lifespan, could be the first ones taken out of service if the oil price remains at the current levels of less than USD 40 per barrel, explains Head of Offshore Research at Clarksons Platou, Erik Tønne, in an interview with ShippingWatch.

"For the existing fields, with an oil price of less than USD 40 per barrel we are going to see an accelerated shutdown of marginal fields. That is to say, in the North Sea and on the UK shelf, where there are many smaller production units that are not profitable at less than USD 70-80 per barrel, rigs will be shut down ahead of schedule."

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