U.S. Oil Production Now Over 10 Percent of World Total – Thanks to Shale
This week, the U.S. Energy Information Administration (EIA) reported that the United States is producing over 10 percent of the world’s crude oil supply. This landmark is testament to how responsible shale development is changing not only the U.S. energy landscape, but the global outlook as well. From the report:
“U.S. tight oil production averaged 3.22 million barrels per day (MMbbl/d) in the fourth quarter of 2013 […]. This level was enough to push overall crude oil production in the United States to an average of 7.84 MMbbl/d, more than 10% of total world production, up from 9% in the fourth quarter of 2012. The United States and Canada are the only major producers of tight oil in the world.”
What does this mean for the United States? Less dependence on foreign nations for North America’s vital energy needs, and a more stable global energy market – not to mention all the jobs and economic opportunity that domestic oil production delivers for American families.
Advanced drilling and completion processes, such as hydraulic fracturing and horizontal drilling, have allowed the United States to produce previously unrecoverable resources from shale and other “tight” formations. These technologies have revived the U.S oil and gas industry—producing resources at record levels all while stimulating our manufacturing sector. Furthermore, domestic oil production has made significant impacts on the national trade deficit. According to an earlier report from the EIA:
“The drop in net imports of oil (crude and petroleum products combined) was the major contributor to the United States reaching its lowest net trade deficit in November 2013 since 2009.”
Additionally, “starting in 2011, the United States has been a net exporter of petroleum products.”
Thanks to shale development, the United States is estimated to have over twenty-six billion barrels of recoverable oil —a resource base that is enhancing our energy security while creating jobs and opportunity along the way. Fortunately, for both the United States and our allies, the benefits of a burgeoning domestic oil supply are also felt far beyond our borders. In a situation that seemed nearly impossible just a few years ago, U.S. oil production from shale is now supporting the stabilization of global oil prices. As the Center for New American Security explains, “internationally, new U.S. oil supplies have helped to cap the price spikes caused by severe global supply disruptions and to moderate oil prices for consumers.”
A recent report from Fitch Ratings reinforces this:
“… all oil-consuming countries benefit from the stabilizing effect of increased U.S. output on world oil prices. This is the benefit of energy interdependence — the linkage of U.S. and world oil markets through reduced imports of crude and increased exports of products.”
As the EIA notes, the United States and Canada are the only two nations in the world that currently produce oil and natural gas from shale at a commercial level; this means that for the foreseeable future North America will continue to lead the world with this technology as well as reap the benefits of energy abundance.
Responsible shale development has been an instrumental part of North America’s ability to strengthen its energy security and will continue to aid at home and abroad for many years to come.