From Matt Badiali, Editor, Stansberry Resource Report:
The zombies are taking over.
Last week, I explained why I believe oil prices are heading higher over the long term. But we aren’t buying just yet… because of the zombies.
Let me explain…
Last July, we discussed “zombie wells” – wells that have been drilled but not completed. The wells aren’t fracked or set up to produce oil. They’re essentially dead wells, waiting to come alive as soon as oil prices rise.
There were 4,230 zombie wells as of April 1, according to Bloomberg Intelligence. They’re evenly divided among four major shale plays: North Dakota’s Bakken, Colorado’s Niobrara, and Texas’ Eagle Ford and Permian Basin.
That’s about 10% of all the wells drilled in 2014. It’s a lot of oil just waiting to come to the market. Here’s what I wrote last year when I was first worried about it…