In 2017, Russia pumped 11 million bpd; Saudi Arabia was close behind at 10 million bpd. According to the International Energy Agency, however, American crude drilling is likely to reach these levels by 2020, when the U.S. will overtake Saudi Arabia to rank as the #2 oil-producing country in the world, just behind Russia.
U.S. Drillers Achieve Record Highs
With the 14 OPEC members together achieving 95% compliance with the cuts required, and with production falling from 39.6 million bpd to 39.2 million bpd, the effect on prices have been exactly as expected.
According to Sigma Drilling Technologies, the pulsation solutions company that manufactures mud pump pulsation dampener products important to oil drilling operations, these cuts have been primarily responsible for American interest in raising production. While production has dropped by no more than 2%, it has helped shore up prices.
With the American shale industry is in better shape than ever before, drillers are likely to pump 10 million bpd this year, a level not seen in a half-century, the IEA has stated in its industry-standard oil market report.
Brent Crude Climbs
While the production cuts were intended to raise revenues for OPEC nations, American drillers have been the ones to benefit. With the IEA suggesting that oil demand remains unchanged at 1.3 million bpd, and with production slipping worldwide, Brent crude has climbed 50% over the past eight months, touching $70 a barrel in January.
The U.S. Energy Information Administration forecasts that tight rock formations in North Dakota and Texas will account for production growth by close to a million bpd in 2018.
Drillers investing in keeping their operations in top form are likely to be able to take advantage of these trends
