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2024: Oil production record 13.4 million bpd
Oil production in the United States reached an all-time high of 13.3-13.4 million barrels/d.
Before the COVID-19 crisis, the maximum production was 13.1 million barrels/d (hereinafter, in order to reduce b/d, although barrels/s or b/d are more common in the technical literature), on average for 4q19 - 12.75 million b/d.
At the height of the COVID crisis, production failed to 9.7 million bpd in the summer of 2020, the active phase of the reduction began on April 20. In the period from April 20 to April 21, average production amounted to 11 million bpd (total losses of about 2 million bpd).
Recovery of production was not simple, 2P21 - average production 11.3 million bpd, in 1P22 - million 11.8 bpd, 2P22 - 12.1 million bpd, 1P23 - 12.3 million bpd, 2P23 - 12.9 million bpd, and since the beginning of 2024 on average 13.2 million bpd.
2023
The United States leads the world in oil production and sets new records: 12.9 million barrels
U.S. crude production led global oil production for the sixth consecutive year with a record average of 12.9 million bpd (bpd), the EIA said in a release.
In December 2023, crude oil production in the United States reached a new monthly record of more than 13.3 million barrels per day.
In 2023, US drillers increased oil production much more than analysts assumed, bringing production to a record level just as OPEC and its allies slowed supplies in an attempt to stop prices from falling.
U.S. shale oil production is near peak. Decline in a few years will raise prices and accelerate inflation
Wall Street is finally about to cash in on shale fields. This will have a profound impact on the planet. U.S. production is likely to peak in the next three to five years, and certainly before the end of this decade.
Less production growth means better returns for shale shareholders.
For nearly two decades, shale mining has been ruinous for shareholders, but it has greatly benefited the rest of America. It supported low oil prices, provided jobs and investment. But things are changing, Javier Blas wrote for Bloomberg Opinion in April 2023. This is the beginning of the end of the greatest American oil boom.
The shale boom was the most lucrative example of capital destruction the energy industry has ever seen. Investors lost, but the U.S. and most of its allies won. Things will change in the next few years, with Wall Street making a profit at the expense of Washington and Main Street. The consequences are likely to be higher oil prices - and inflation - and weakening U.S. energy policy positions.
According to March 2023, shale producers face serious problems - oil wells in the Perm basin, where the lion's share of American "black gold" is produced, produce less and less oil.
Moreover, problems with the depletion of oil reserves in the United States are felt immediately in many states at the same time - from South Dakota to Texas and New Mexico to Delaware. For example, in Delaware, 10% of the best wells on average produce 15% less oil than 6 years ago.
Over the decade of the shale boom, the United States was able to increase oil production almost twice - from 7 million barrels per day in 2009 to 13 million barrels before the start of the COVID-19 pandemic. But then oil production decreased - and so far it cannot return to the level of three years ago.
Texas demands U.S. government allow more oil to be produced
President Joe Biden should stop harming oil production in the United States, the Texas oil regulator said in April 2023.
They called the president's energy policy "destructive" and called on him to let American operators produce more energy.
American oil producers abandon oil projects in Africa and try to transfer them to Britain
In January 2023, news continues to arrive from Africa about the curtailment of American oil production projects.
Over the past two years, the continent's largest oil asset owner ExxonMobil has announced its withdrawal from Nigeria, Equatorial Guinea, Ghana, Niger, South Africa, Chad and Cameroon.
In early January 2023, another American company Chevron confirmed rumors of plans to leave Nigeria with its new investment program.
It is estimated that American companies sell about 30% of their assets in Africa.
One of the main reasons is the need to concentrate on production in South and North America. According to OPEC estimates, against the background of a reduction in crude oil production in Africa, production in the Americas will grow to 28 million barrels per day in 2023, which is 2.3 million barrels per day more than before the pandemic.
This reversal is due to the greater profitability and attractiveness of projects for investment.
In addition, American companies are worried about strengthening cooperation between Russia and China with the countries of South and Central America. In this light, "home" projects are becoming a priority for the United States for African.
Another reason is the need to use the funds allocated by the US government for the development of green power. US companies are guaranteed access to these funds, which will make it possible to advance in the production of LNG and hydrogen, as well as provide cheap energy resources to European companies in the "relocation" stage in the United States.
American TNKs are developing the most high-tech segment of the energy market at state expense, while pulling key technologies from the EU, the Rybar channel noted.
In America's dwindling TNK fields in Africa, oil pumping is declining and pollution and infrastructure maintenance costs are rising. Given the risk associated with terrorism, corruption, and other factors associated with most projects in Africa, it becomes more profitable to sell their assets than to develop new deposits.
Buyers of American assets in Africa can only be companies with comparable levels of technology and access to the capital market. Local companies, with all the desire, will not be able to independently develop oil and gas projects in Africa.
And in order to avoid the departure of these valuable assets under the control of companies from Russia and China, the US oil and gas giants are trying to transfer them under the control of their colleagues from Britain in an organized manner.
A wide network of offshore companies, organized by companies from Britain and Holland with the permission of US regulators, is used both to obtain funding from the world's largest banks and to conceal the ultimate beneficiaries operating in Africa.
Since the mid-2010s, British oil companies have begun active expansion in African countries. Moreover, British companies are ready to work with risky but profitable enterprises, such as LNG projects in Mozambique.
A recent example of such Anglo-American cooperation was [2] ExxonMobil's December deal to sell its Chad and Cameroon division to British company Savannah Energy for $407 million .
As a result of the transaction, the British company received partial control over seven promising fields and a large logistics project - the Chad-Cameroon oil pipeline.
The sale of assets of American TNKs is often positioned in the pan-African media as a kind of "retreat of neo-colonialists" and the redistribution of resources in favor of "local" companies engaged in mainly African projects. At the same time, the fact that "local" companies are often only an offshore shell behind which capital from Britain is hidden is delicately silent.
2022
Oil and gas production leads U.S. productivity gains in 10 years
Oil was written off, and by 2022 it became the most productive industry in the United States.
Oil and gas production shows the fastest growth in labor productivity of any industry in the last decade.
Oil production in the United States is almost one and a half times more than in Saudi Arabia. And all this with less than a third of the rigs and much fewer workers than was required 10 years ago.
Take-off of oil production cost up to $28 per barrel
The cost of oil production in the United States amounted to $28 per barrel in the first quarter of 2022. For the United States, this is a new record.
Pipe shortage does not allow to quickly increase shale oil production amid conflict with Russia
Adding to the growing list of reasons why American shale oil producers in March 2022 are not increasing production as quickly as necessary amid the global energy crisis is a shortage of steel.
To drill more wells, they need steel pipes to lay inside the wells and bring oil out. These pipes have become more expensive and scarce.
The price of pipes (oil-country tubular goods, OCTG) USA hit $2,400 dollars a tonne this month, up 100% from a year ago, according to KeyBanc Capital Markets.
According to the US Office of International Trade, Russia and Ukraine combined provide about 15% of all metal imported into the US. Russia also supplies a key ingredient for welded products known as a coupling.
2021: US world leader in oil production
2020
Oasis Petroleum files for bankruptcy over debt and low oil prices
In September 2020, the American oil and gas company Oasis Petroleum filed an application for bankruptcy in a Houston court. As a reason for its decision, the shale producer pointed to the inability to service debts due to low oil and gas prices.
As of June 30, 2020, the company's long-term debts amounted to $2.76 billion, and the volume of cash and cash equivalent amounted to only $77.4 million.
In 2020, a number of American shale companies filed similar bankruptcy applications, including Whiting Petroleum, Chesapeake Energy, Ultra Petroleum and Chaparral Energy.
In total, more than 200 energy companies have already gone bankrupt in the United States since 2015. These are the data of the law firm Haynes & Boone, cited by Bloomberg.
Devon Energy and WPX Energy shale merger
In September 2020, American oil and gas companies Devon Energy and WPX Energy Inc. agreed on a merger that will form one of the largest shale producers in the United States worth about $12 billion. Read more here.
Chesapeake Energy Bankruptcy
In June 2020, Chesapeake Energy, one of the pioneers of the US shale industry, filed for bankruptcy and asked for protection to restructure debt.
In the US, 17 shale oil producers went bankrupt
A number of shale oil companies in the United States are under significant pressure due to the growing economic crisis.
By the end of May, 17 manufacturers initiated bankruptcy proceedings in 2020. Their total debt totals over $14 billion.
By the end of 2020, bankrupt companies are expected to increase to 73.
The number of oil and gas rigs in the United States has dropped to a minimum in 80 years
On May 8, 2020, the American oilfield service company Baker Hughes published data according to which the number of oil and gas rigs in operation in the United States decreased to the smallest value in the last 80 years.
In April 2020, the number of installations decreased by 206 units (by 26.7%), amounting to 566, on an annualized basis, the figure decreased by 446 units. Since the beginning of the year, the figure has decreased by 225 installations.
Unprecedented problems began against the backdrop of the coronavirus pandemic, which led to an economic crisis and a radical decrease in fuel demand. Fuel demand declined by about 30% in April 2020, and companies began cutting costs sharply, laying off thousands of workers and closing production to offset the world's oil glut. Consumption has risen somewhat over the past couple of weeks, but an oversupply is expected to last for months, if not years, according to a report Baker Hughes released on May 8, 2020.
The decline in the number of rigs was already ahead of the decline in 2015-2016, when at its peak negative dynamics in the United States reached 53-54%. The bottom of the cuts has not yet been reached, but record low rates of decline in both absolute and percentage terms have already been passed, experts are sure. Oil production in the United States since the beginning of March has already fallen by 1.2 million barrels per day, the drop in raw material production was about 9.2% in April.
By the end of 2020, the number of rigs in operation in the United States will halve to 200, Raymond James analysts predict.[1]
Start of bankruptcy of oil companies: Whiting Petroleum failed to cope with $2.2 billion debt
In early April 2020, oil companies began to go bankrupt in the United States due to the collapse of raw material prices. Whiting Petroleum, which develops shale oil fields in North Dakota, has filed a lawsuit for protection from creditors, offering them to convert $2.2 billion in debt into 97% of its shares, which actually means it is impossible to fulfill its obligations. Read more here.
2019: Shale oil production boom weakens
As of September 2019, the boom in shale oil production is weakening, despite the fact that at this time, after attacks on Saudi Arabian oil facilities, this sector is more important for the global market than ever before, writes The Wall Street Journal.
According to power engineering specialists USA the ministry, oil production in the country in the six months of 2019 increased by less than 1%, while a year earlier the growth was about 7%.
Moreover, if a few years ago, when shale oil production fell, this was associated with a decrease in world prices, then this year the reduction in production is due to key operational problems. For example, experts note that production volumes are lower than expected due to the too close location of the wells to each other. In addition, it has become apparent that attractive shale assets are ending faster than expected.
The identified problems show that the advantage due to technological and engineering breakthroughs, which allowed shale companies to produce record volumes of oil and gas, is gradually fading away, the newspaper writes.
According to the forecast of the US Department of Energy, oil production in the country in 2019 will average 12.2 million barrels per day (b/s), compared with 11 million b/d a year earlier. In 2018, production increased from 10 million bpd in January to 12 million bpd in December, and now activity in the sector is slowing down.
 | "We are approaching peak production and we are close to peak physical production in these fields," notes Evercore ISI Managing Director James West. |  |
Shale oil production in the United States as of September 2019 is about 8 million bpd, which corresponds to about 10% of global oil production and provides serious support to the global market, especially at moments of increased geopolitical tension, provoking jumps in oil prices.
Some experts remain confident that the shale oil market still has many years of growth ahead of it. Rystad Energy estimates that shale oil production will peak at 14.5 million bpd around 2030. The trajectory of production growth, according to experts, can change factors such as rising oil prices and the consolidation of the shale market.
An increase in the area of shale areas at the disposal of large oil companies, including Exxon Mobil and Chevron, may contribute to maintaining the trend towards production growth. These companies have already become leaders among producers of the Permian Basin and New Mexico in terms of production volumes.
Meanwhile, small and medium-sized producers are forced to reduce production, choosing to increase profitability of operations, amid weakening support for the sector from Wall Street and maintaining prices near $60 per barrel. Under such conditions, companies can no longer drill new wells as often as before.
IHS Markit experts note that even a steady rise in oil prices will have a limited impact on the shale market.
According to IHS estimates, shale oil production in the United States will increase by 480 thousand b/d in 2020 at an oil price of $62 per barrel. An increase in oil prices by $10 per barrel will lead to an increase in production by only 200 thousand b/d - this is significantly weaker growth than in 2018.
2018
The United States comes out on top in the world in oil production
The United States became the second oil producer in the world
The United States increased oil production by 1.34 million barrels per day compared to March last year and became the second country in the world in oil production after Russia, overtaking Saudi Arabia, according to a report by the International Energy Agency (IEA) (data from April 2018[2].
According to the IEA, Russia produces 11.35 million barrels per day, and Saudi Arabia - 9.92 million barrels. In March 2018, the United States produced 9.96 million barrels per day. The United States will continue to increase oil production, according to the IEA report, but transport restrictions may become an obstacle to this. At the same time, oil consumption in the United States in January increased by only 1.23 million barrels per day compared to January last year. The agency does not provide data for March.
The growth in US production may fully compensate for the growth in global oil consumption in 2018. The IEA predicts that in October - December 2018, the average daily oil consumption in the world may exceed 100 million barrels. According to the results of the first quarter of this year, it amounted to 98.1 million barrels per day.
The agency at the beginning of the year gave a forecast that in 2018 the leader in oil production will be replaced, it will be the United States, which will overtake Russia. But the agency did not give specific figures, as well as deadlines. Now production in the United States is kept at long-term peaks, in November last year it exceeded the 1970 record (10.044 million barrels per day) by 22,000 barrels.
Ninth country in the world in confirmed oil reserves
2010
Change in US energy doctrine: from taking over fields in other countries to developing its own oil and gas industry
Since 2010, the United States has begun to radically change the energy doctrine (the foundations were laid in 2006), accelerating the reduction of net imports of oil and petroleum products through increased production, which was facilitated by many factors and circumstances:
- Refusal of major offensive operations and a large-scale presence in an active theater of operations after coordinating the withdrawal from Afghanistan with the strengthening of external targeted special operations, diplomatic, economic pressure and intelligence. This made it possible to reduce the concentration of external risks, focusing on the internal agenda.
- The concept of "energy parity" is to reduce dependence on energy imports in potentially unstable regions of the Middle East and Africa to almost zero, minimizing the risks of supply chain disruption.
- Consolidating bipartisan political support for the idea of "US energy independence" and building a powerful political lobby to develop support for the industry.
- A whole range of tax deductions, benefits and incentives from the US government for shale production, along with agreements with financiers on preferential loans to accumulate investments in the industry, from both large and small companies.
- Ripening of hydraulic fracturing and horizontal drilling technologies in 2007-2010, which made it possible to realize relatively recoverable investments that were previously considered unprofitable.
First, the United States cut/isolated imports from the Middle East, replacing oil imports from Canada and Mexico, and since 2015 has made progress in developing its own oil and gas industry.
As a result, in 2007, the United States was a net importer of 13 million barrels/d, at the beginning of 2023, a net exporter of up to 2 million barrels/d.
The Shale Revolution
Main article: Shale gas
1985: U.S. targets dominance in key oil and gas production regions after energy crisis
The energy doctrine of USA 1985-2008 assumed the establishment of dominance in key regions of oil and gas production and unconditional control of transport routes. Under this doctrine, expansion was started in the Middle East (as a response to the energy crisis of the 1970s and 80s) with shock methods (through wars, overthrowing governments, and establishing controlled regimes To Africa in and in the Middle East). US oil and gas corporations Europe have established control over oil fields, and oilfield services companies have served and continue to serve all key oil exporters in the world in 2023.
1937
California, 1937]]
1931
1928
See also
Notes
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