“We can adjust quickly,” he said. “It’s a lot easier to adjust companies than it is for countries to adjust. When you’ve got people starving or social policies within countries that people are used to, it’s hard to adjust those.”
‘Calm Down’
Continental declined 1.9 percent to $40.20 yesterday in New York, down 50 percent from its August high. An index of oil and gas producers on the Standard & Poor’s 500 Index has fallen 28 percent since June 20, when U.S. crude closed at a 2014 high of $107.26 a barrel.
Hamm has said in the past that his company can turn a profit at prices of $50 a barrel. Continental plans to boost output by as much as 29 percent next year, while holding spending at 2014 levels, according to a Nov. 6 company presentation. Hamm declined to say how those plans may change if prices fall further.
In the most profitable areas of the Bakken, producers can turn a profit on average with oil prices above $65.03 a barrel, according to Bloomberg New Energy Finance. Prices may fall to $50 a barrel by early next year, according to Wolfe Research LLC.
“This is a bump in the road, a correction, an adjustment that we’re going through right now,” Hamm said. People “need to calm down, take the long view and there’s certainly no need to panic at this point or any point.”