Weekly US crude oil production
US crude oil production rose by 128,000 bpd (barrels per day) or 1.3% to 9,878,000 bpd on January 12–19, 2018, according to the EIA. Production is near the highest level since 1970. US crude oil production also increased by 917,000 bpd or 10.2% from a year ago.
US crude oil production recovery
US oil production has risen by 1,450,000 bpd or 17.2% since July 1, 2016. Crude oil prices have risen more than 100% since February 2016. Higher oil prices led to an increase in capital spending in the energy (PXI) (VDE) sector in 2017. Increased spending supported the increase in US crude oil production.
Estimates for 2018
The EIA estimates that US oil production could rise 10% to ~10,270,000 bpd in 2018 from 2017—the highest annual production average ever. OPEC estimates that US oil production would rise by 820,000 bpd in 2018.
Production cuts and US oil production
US crude oil production is expected to increase 16% or by 1,410,000 bpd from January 2017 to December 2018. If US production rises at this pace, it could offset 75% of the current production cuts by major oil producers.
Record US oil production could be the biggest threat to oil prices in 2018. OPEC expects that non-OPEC production could increase by 1,150,000 bpd in 2018, which could also pressure oil (DWT) prices.
Next, we’ll discuss gasoline inventories.