February 28, 2018, by Jessica Summers
U.S. oil production reached a record high in November as the shale boom puts the nation among the world’s biggest suppliers and upends global markets.
Once the world’s largest importer of crude, the U.S. is passing Saudi Arabia and closing in on Russia to become the world’s largest producer. Oil prices above $60 a barrel have lured companies to ramp up production. Oil and gas exploration last year was a money-maker for the first time in more than a decade, according to Wood Mackenzie Ltd. As a result, drillers in the U.S. are using the most oil rigs since 2015.
Efforts by the Organization of Petroleum Exporting Countries to trim output and tighten global markets has fueled a surge in exports, with the first supertanker leaving an American port earlier this month. The current “explosive growth” in U.S. oil output may extend beyond 2018, International Energy Agency Executive Director Fatih Birol said this week.
Shale’s impact on the global market can be felt as OPEC’s head plans to meet with shale producers in Houston on Monday, the second consecutive year he’s met with the group’s biggest rivals. Compliance by OPEC and its allies to their supply deal came in at 133 percent last month. And even though non-OPEC decline rates accelerated last year, U.S shale supply will fill the gap, according to Bank of America Merrill Lynch analysts.
Nationwide monthly crude production was revised to 10.057 million barrels a day for November, the highest figure on record in monthly data collected since 1920, the Energy Information Administration reported in its Petroleum Supply Monthly report Wednesday. Daily output slipped back to 9.949 million in December. The EIA’s crude-oil production data includes lease condensate.
Weekly crude oil production is proving irrepressible, rising to near 10.3 million barrels a day and heading for 11 million late this year.