Oil producers spend big on projects despite questions about prices

Financially strapped oil companies are spending billions to boost production even before it is clear that crude oil price increases brought on by output cuts by OPEC can be sustained, Reuters reports. The news service says that, even with oil prices about 70% higher than a year ago, “most companies have yet to reach the point where their cash flow covers annual shareholder payouts and expansion projects vital to the industry's long-term survival.” Factor in other expenses, such as the interest on debt, and the break-even point is pushed out until at least 2020, according to an estimate by Citigroup. For more, read the full story.