US considers crude export as it surpasses S. Arabia as the world's top crude oil producer
US, The World's Top Crude Oil Producer Exporting On Supply Buildup
The US will continue as the world's biggest Crude Oil producer in Y 2014 after overtaking Saudi Arabia and Russia, as extraction of energy from shale rock fuels the nation's economic recovery, Bank of America Corp. (NYSE: BAC ) said.
US production of Crude Oil, along with liquids separated from Nat Gas, surpassed all other countries this year with daily output exceeding 11-M BPD in Q-1, the bank said in a report Friday.
The country became the world's largest Nat Gas producer in Y 2010. The International Energy Agency (IEA) said in June that the US was the biggest producer of Crude Oil and Nat Gas liquids.
The US increase in supply is a very meaningful amount of Crude Oil. The shale boom plays a Key role in the US recovery. If the US did not have this energy supply, prices at the pump would be unaffordable.
CrudeOil extraction is soaring at shale formations in Texas and North Dakota as companies split rocks using high-pressure liquid, a process known as hydraulic fracturing, or fracking.
The rise in supply combined with restrictions on exporting Crude Oil is curbing the price of WTI Crude Oil, America's benchmark. The US, the world's largest Crude Oil consumer, still imported an average of 7.5-M BPD of Crude Oil in April, according to the US Department of Energy's (DOE) statistical arm.
US Crude Oil output will rise to 13.1-M BPD in Y 2019 and plateau thereafter, according to the IEA, a Paris-based adviser to 29 nations. The country will lose its top-producer ranking at the start of the Y 2030s, the agency said in its World Energy Outlook in November.
“It's very likely the US stays as # 1 producer for the rest of the year” as output is set to increase in 2-H of this year. Production growth outside the US has been lower than the bank anticipated, keeping global Crude Oil prices high.
Partly as a result of the shale boom, WTI Crude Oil futures on the New York Merc remain at a discount of about 7 bbl to their European counterpart, the Brent contract on ICE Futures Europe's London-based exchange. WTI Crude Oil was at 103.74 a bbl as of 4:13 p London time Thursday.
Libya is set resume exports as soon as possible from 2 Oil terminals in the country's east after taking back control from rebels who blocked Crude Oil shipments for the past year a spokesman for the state-run National Oil Corp., said from Tripoli.
The US will consolidate its position as the world's biggest producer in the coming months if returning Libyan supply limits the need for Saudi bbls.
“There's a very strong linkage between oil production growth, economic growth and wage growth across a range of US states,” according to a Bank of America analyst said. Annual investment in Crude Oil and Nat Gas in the nation is at a record $200-B, reaching 20% of the country's total private fixed-structure spending for the 1st time.
A US Commerce Department decision to allow the overseas shipment of processed ultra-light Crude Oil aka condensate, has fueled speculation the government may ease its 40 yr ban on most Crude Oil exports.
Pioneer Natural Resources Co. (NYSE:PXD), and Enterprise Products Partners LP (NYSE:EPD) will be allowed to export condensate, provided it is 1st subject to preliminary distillation, the companies said on 25 June.
The decision was “a positive first step” to dispersing the build-up of Crude supply in North America, Bank of America said in a report on 27 June. The US could potentially have daily exports of 1-M BPD, including 300,000 bls of condensate, by the end of the year, according to a 25 June report from Citigroup Inc. (NYSE:C)