US crude oil production
The EIA (U.S. Energy Information Administration) reported that US crude oil production rose by 28,000 bpd (barrels per day) to 9,293,000 bpd on April 21–28, 2017.
Production rose 0.3% week-over-week and 5.3% year-over-year. US crude oil production is near the highest level since August 21, 2015. The rise in US crude oil production pressured crude oil prices. As a result, US crude oil (IXC) (IYE) (FXN) prices are down 15.5% YTD (year-to-date).
Lower crude oil prices have a negative impact on oil and gas producers’ earnings like Devon Energy (DVN), ExxonMobil (XOM), Warren Resources (WRES), and QEP Resources (QEP). For more on crude oil prices, read Part 1 of this series.
Peaks and lows
US crude oil production peaked at 9,600,000 bpd in June 2015. On the other hand, it hit a low of 8,428,000 bpd for the week ending July 1, 2016—the lowest level since June 2014. Since then, US crude oil production has risen ~10.2%.
US crude oil production estimates
The EIA estimates that US crude oil output will average 9,220,000 bpd and 9,900,000 bpd in 2017 and 2018, respectively. US production will likely hit a 48-year high in 2018. Production averaged 8,880,000 bpd in 2016.
Tyche Capital Advisors thinks that if US production rose at the current pace, it would offset the reduction in supply from major oil producers’ output deal. Read Could US Crude Oil Production Push Production Cut Deal Past 2017? for more on monthly US crude oil production and major oil producers’ production cut deal.
In the next part of this series, we’ll take a look at US crude oil refinery demand and crude oil imports.