U.S. Is Now The Largest Global Producer of Crude Oil
WASHINGTON – The United States likely surpassed Saudi Arabia and Russia earlier this year to become the largest producer of crude oil in the world, according to the U.S. Energy Information Administration.
EIA announced Wednesday that in February, U.S. crude oil output exceeded production in Saudi Arabia for the first time in two decades. Likewise, in June and August, EIA found that U.S. crude oil production surpassed Russia for the first time since February 1999.
According to EIA’s Short-Term Energy Outlook report, U.S. crude oil production is expected to be greater than both countries for the remainder of this year and through 2019.
EIA estimates that crude oil production in the United States averaged 10.9 million barrels per day during August. The agency projects that crude oil production should average 10.7 million barrels per day for all of 2018, up from 9.4 million barrels averaged in 2017.
The agency estimates that production is likely to increase to an average of 11.5 million barrels per day during 2019.
Production of crude oil in the United States has increased rapidly since 2011.
Most of this growth has occurred as a result of shale exploration in the Permian basin in Texas and eastern New Mexico, and the Bakken shale in North Dakota and Montana, as well as drilling in the Federal Offshore Gulf of Mexico, EIA reported.
However, oil producers took a major hit beginning in 2014 when prices collapsed, leaving many to suspend drilling operations. Prices started to rebound in 2016.
That year, the price of brent crude oil stood at $43.74 per barrel. This year, the price per barrel has averaged $72.84, EIA reported, and is expected to increase to an average of $73.68 per barrel in 2019.
As crude oil prices started their rebound in 2016, energy companies freed up additional investment to reinvigorate exploration programs.
By comparison, Russia and Saudi Arabia have maintained stable crude production levels in recent years, the EIA noted.
Copyright 2018 The Business Journal, Youngstown, Ohio.
Published by The Business Journal, Youngstown, Ohio.
CLICK HERE to subscribe to our print edition and sign up to our free daily headlines.