ENERGY/OIL/TRADE DEALS: “Surging U.S. crude oil production this year is expected to surpass output in Saudi Arabia and rival that of Russia, the world’s two largest oil producers, the International Energy Agency said Friday [1-19-18].
Boosted by a resurgent shale industry, U.S. crude production will likely climb above 10 million barrels a day in 2018, a high not seen since 1970, the agency said in its closely watched monthly oil market report. The IEA raised its outlook for U.S. crude supply this year by 260,000 barrels a day, to a record 10.4 million barrels a day, largely a result of the recent rally in crude prices…
OPEC and 10 producers outside the cartel, including Russia—which produced around 10.9 million barrels a day in 2017—agreed late last year to extend an agreement to hold back crude output by nearly 2% through the end of 2018. The accord was first struck at the end of 2016 with the aim of reining in a global supply glut that has weighed on prices for over three years.
OPEC’s 14 members averaged a compliance rate of 95% with the cuts throughout last year, according to the IEA, falling to 39.2 million barrels a day from a high of 39.6 million barrels a day.
But U.S. production offset around 60% of those cuts, the agency said. With growth of 600,000 barrels a day last year, the U.S. shale industry ‘beat all expectations,’ benefiting from higher oil prices and ‘cost cuts, stepped up drilling activity and efficiency measures enforced during the downturn,’ the IEA added.”
-Christopher Alessi, “U.S. Oil Output Expected to Surpass Saudi Arabia, Rivaling Russia for Top Spot,” The Wall Street Journal online, Jan. 19, 2018 11:54am