U.S. Crude Production Growth Stalled In April

The Energy Information Administration reported that April crude oil production averaged 10.467 million barrels per day (mmbd), off 2,000 b/d from March’s all-time record high for the U.S. The small but unexpected decline was due to unplanned maintenance in the Gulf of Mexico (GOM), which reduced production there by 98,000 b/d. Otherwise, healthy increases were recorded in North Dakota (61,000 b/d) and Texas + New Mexico (55,000 b/d).

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The EIA-914 Petroleum Supply Monthly (PSM) figure was 115,000 b/d lower than the weekly data reported by EIA in the Weekly Petroleum Supply Report (WPSR), averaged over the month, of 10.582 mmbd. EIA’s most recent weekly estimate for the week ending June 22nd was 10.900 mmbd.

U.S. Crude Production Growth

The April figure was nonetheless a year-over-year gain of 1.318 mmbd. And the EIA Drilling Production Report estimates a 141,000 b/d gain for July.

Looking further ahead, the EIA is projecting December 2018 output to rise to 11.450 mmbd, up 1.42 mmbd from December 2017. Also, EIA projects that other supply (liquids) will rise to 6.93 mmbd, up 640,000 b/d from last December, for a total gain of 2.06 mmbd.

U.S. Crude Production Growth

The biggest concern about realizing these forecasts is infrastructure constraints in the Permian Basin. The recent slowdown in oil rigs being added appears to justify that concern.

Conclusions

The annual rise in U.S. production of crude and liquids of about 2.0 mmbd is larger than the predicted growth in world demand. The real question is whether the OPEC+ production increases can make-up for further potential losses in Venezuela and Iran, as well as Libya and Angola.

Check back to see my next post!

Best,
Robert Boslego
INO.com Contributor - Energies

Disclosure: This contributor does not own any stocks mentioned in this article. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

One thought on “U.S. Crude Production Growth Stalled In April

  1. Trump cannot talk down, jawbone the price of oil supply/demand determine the price. Don’t believe Saudi’s/Russia about anything they both lie all the time. Oil moving up again any supply disruption will spike oil how high anyone’s guess. Always be prepared for anything.

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