Dear Santa: Please, give us more clarity on 2015 upstream oil spending

— Given the gradual but precipitous drop in oil prices in recent months, especially in the last week or so, industry has poor visibility on next year's activity until the majority of upstream companies release their 2015 capital budgets.

And even those operators that have guided on next year's capex, did so at a time when oil prices were a good $10-$15/b higher than they are currently.

But some preliminary clues are emerging at post-OPEC industry conferences in recent days, constituting the first public remarks after a controversial meeting last week when the cartel took a decision to maintain its oil output at a current 30 million b/d.

At analyst conferences since then, and not unexpectedly, the impact of the price of oil for not only producers but also refiners and the offshore industry appeared the main topic on attendees' minds. At a time when many were taken by surprise as the price of oil drifted and recently plummeted below $70/barrel, it's now hard to think about much else.

A few early data points from the two-day Cowen and Company analyst conference in New York on Tuesday:

* Big oilfield services provider Schlumberger will take a $1 billion charge for two impairments in Q4. The reasons: lower exploration activity this year that is expected to continue into 2015, resulting in an $800 million charge. The company will retire older vessels with higher costs and lower towing capacity, convert remaining lower-end vessels to source boats, and cancel most of its third-party charters.

Also, Schlumberger will reduce its head count by an undisclosed amount, taking a separate $200 million charge, Patrick Shorn, the company's president of operations and integration, said.

"Only three billion barrels of recoverable oil and condensate were discovered in 2014, the lowest level seen in 25 years and roughly half that discovered last year," Shorn said, explaining industry's global exploratory results this year.

* Western Refining Treasurer Jeffrey Beyersdorfer said he does not believe $70/b crude will impair production in the West Texas Permian Basin, in the San Juan Basin or even largely for the more expensive Bakken Shale in North Dakota/Montana.

Beyersdorfer said these areas mostly are produced by large or "decent-sized" companies with "good balance sheets." But he added breakeven prices in those plays, which account for the bulk of unconventional US oil production are mostly below $70/b.

* Big offshore driller Transocean believes the global marine rig count should not only be flat in 2015, but "we expect 2015 to be every bit as tough if not more difficult than 2014," company CEO Steven Newman said. Offshore dayrates, particularly for deepwater rigs, fell anywhere from 15-35% in recent contract rollovers this year.

But he added the Gulf of Mexico rig count would "likely ... go up" next year while rig counts in other areas, which he did not immediately name, will likely offset that increase.

* At RBC Dallas Energy Day, Marcellus Shale gas play pioneer Range Resources said it plans to cut back in crude oil areas such as the Mississippi Lime, according to RBC analyst Leo Mariani in a report issued after the event. Range added it may let some of the acreage expire.

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The worst of the recent oil price bungee-jump is its year-end timing, a period when oil company managers typically map out their capital spending plans for the new year. The combo of uncertain prices and the need for forward clarity in budgeting is unsettling to industry.

It's happened before, and not too long ago either. The big recession of 2008-2009 also began, at least for the oil biz, in September when crude prices were also receding. Then, however, the threat was coupled with a global economic recession so great that many upstream companies retrenched in rapid self-defense, cut rigs immediately and pulled in their shutters, which ironically made for a little bit more certainty. All heels appeared to be dug in virtually at once as oil sunk from September 2008 NYMEX prices largely above $100/b -- they already had been slipping from an all-time high of nearly $147/b the previous July) -- to $44.60/b on the last day of that year.

(Those who were around at the time will recall that oil eventually slid below $34/b in February 2009, only to revive to the $70s/b by the following August. Prices stayed in the $70s-$80s/b level for a couple of more years before inching up later on.)

One curious observation this time around: while analysts and observers have predicted budgets will fall around 20-30% next year, some company managers insist that even their non-mainstream plays make a lot of money even at current oil prices around $66-$67/b.

Peter Hill, interim CEO of Midstates Petroleum, which operates in the Mississippi Lime in Oklahoma, insisted at the Cowen conference on Wednesday that his company's margins are “robust” even at $50/b oil. That play is shallower in depth, only around 4,000-7,000 feet, so drilling costs are much lower than, say, the Bakken Shale of North Dakota or the West Texas Permian Basin's 8,000-10,000 feet.

Hill said well costs in the Mississippian are around $3.5 million, against $8-$9 million in the Bakken.  But many analysts claim the Mississippian play may be too marginal at current prices and expect some drilling there may be shelved for the time being if today’s oil price levels persist for much longer.

As pundits say, not knowing is always the worst case. But as December progresses, some of the anxiety should ease as more companies release 2015 capex or provide more signals of their future direction. Within two or three weeks -- albeit far too long when you're tapping your fingers, waiting for the next stage -- we should know a lot more. But it may still not be enough for comfort.