U.S. oil production jumped last week to the highest level since
January 1992, cutting consumption of foreign fuel and putting the U.S.
closer to energy independence.
Drilling techniques including hydraulic fracturing, or fracking,
pushed crude output up by 134,000 barrels, or 1.8 percent, to 7.401
million barrels a day in the seven days ended July 5, the Energy
Information Administration said today.
Rising crude supplies from oilfields including North Dakota’s Bakken
shale and the Eagle Ford in Texas have helped the U.S. become the
world’s largest exporter of refined fuels including gasoline and diesel.
The shale boom has also helped cut world reliance on OPEC oil even as
global demand gains.
"It adds to supply in a world where demand continues to grow, and it
certainly reduces our reliance on OPEC,” said Andy Lipow, president of
Lipow Oil Associates LLC, a Houston-based consulting firm, who expects
output to reach 7.75 million barrels a day by the end of this year.
The U.S. met 89 percent of its own energy needs in March, the highest
monthly rate since April 1986, EIA data show. Net imports of crude oil
and petroleum products will fall to 5.7 million barrels a day by 2014,
down from 12.5 million in 2005, the EIA said yesterday in its Short-Term
Domestic crude output will average 7.31 million barrels a day in 2013
and 8.09 million in 2014, the EIA, a unit of the Energy Department,
said in the report.
The Organization of Petroleum Exporting Countries said today that
consumption of its crude will decline 300,000 barrels a day next year to
29.6 million, 2.6 percent less than the 12-member group is pumping now.
World oil consumption will advance by 1 million barrels a day, or 1.2
percent, to 90.7 million next year as emerging nations expand and
developed economies continue to recover, the organization’s Vienna-based
secretariat said in its monthly market report.
The abundance of crude has made the U.S. an increasingly important
refining hub. Distillate production, largely comprised of diesel fuel,
soared to a record 5.036 million barrels a day last week, the EIA said
Some of that will be put on tankers to meet foreign demand.
Venezuela, for example, imported an average of 94,000 barrels a day
through April, compared with 85,000 barrels a day in 2012, EIA data
show. China’s imports expanded to 108,000 barrels a day, also up from
85,000 last year.
"Refiners have been modifying and investing in their operations to
produce increasing amounts of diesel, which is growing worldwide at a
much faster rate than gasoline demand,” Lipow said.
West Texas Intermediate futures rose $2.99, or 2.9 percent, to
$106.52 a barrel on the New York Mercantile Exchange, the highest
settlement price since March 27, 2012.Originally posted by Fuelfix via Bloomberg