Oil king predicts drilling cutback

Harold Hamm with ex-wife Sue Ann ... drill when the price is right. Photo / AP

Hamm says Opec decision is good news for US producers because they can react quicker than cartel nations.

Billionaire wildcatter Harold Hamm, a founding father of the United States shale oil boom whose fortune has fallen by more than half in the past three months, says US drilling will slow as producers cut back amid falling oil prices.

But declining activity from Texas to North Dakota won't be as harmful to the industry as some have feared, the chairman and chief executive officer of Continental Resources said.

He believes Opec's refusal to curb output last week bodes well for American producers, who can outlast countries in the cartel that depend on higher oil prices.

"Will this industry slow down? Certainly," Hamm said.

"Nobody's going to go out and drill exploration areas and other areas at a loss. They'll pull back until the price recovers. That's the way it ought to be."

Oil has declined to a five-year low after prices above US$100 a barrel helped spark a boom in output from US shale formations.

The value of Hamm's wealth, which is largely tied to Oklahoma City-based Continental, has fallen by more than $12 billion in three months, according to the Bloomberg Billionaires Index.

Hamm predicted a swift recovery in oil prices, which have declined more than 36 per cent since June. West Texas Intermediate, the US benchmark, fell below US$65 a barrel yesterday before settling up 4.31 per cent at US$69.

Hamm has said his company can turn a profit at US$50 a barrel.

US drillers from Texas to North Dakota are pumping the most in three decades, many betting they can outlast Venezuela, Iran and other nations that need higher oil prices to fund government budgets.

Continental's shares declined 1.9 per cent to US$40.20 in New York, down 50 per cent from their August high.