It's earnings season — the quarterly event when publicly traded companies must report their profits and losses.
One trend that has emerged each quarter for the past several years is that while most producers are working to increase their oil output, many local producers — and most domestic producers in general — still produce a large amount of natural gas.
A barrel of oil contains six times the energy as 1,000 cubic feet of natural gas. Historically, the two fuels have traded at a roughly 6-to-1 ratio.
That all changed in 2008 when domestic natural gas producers discovered how to produce natural gas from shale and other dense rock layers.
They flooded the market with natural gas, causing prices to tumble from $13.31 in July 2008 to $2.25 just 14 months later.
The price has remained between $2 and $4 for much of the past three years even as the price of crude oil has hovered between $80 and $110.
The trend has led natural gas companies to produce as much oil and natural gas liquids as possible, moving away from a focus on natural gas. Natural gas liquids such as butane, propane and ethane command a higher price than natural gas, but still trade for far less than oil.
Many producers prefer a mix of oil, natural gas liquids and dry natural gas, saying the blend provides protection from sudden price changes in any one of the fuels.
Most wells produce all three. The focus today is primarily on wells with a relatively high oil content, but there's not practical way to not recover natural gas.
Oklahoma's publicly traded energy companies illustrate that point.
Chesapeake Energy Corp., which formerly billed itself as “America's Champion of Natural Gas,” this week said it boosted its oil production 22 percent over the past year.