In 2018, the United States petroleum production increased 16% while simultaneously increasing natural gas production by 12%. According to the Energy Information Administration (EIA), “these totals combined established a new production record.” The United States has been the largest producer of natural gas since it passed Russia in 2011, and last year the U.S. surpassed Saudi Arabia to become the largest producer of petroleum. All signs indicate that the U.S. will continue to expand their production prominence, and over the next decade, the U.S. is set to account for 61% of all new global oil and gas production, nearly nine times the amount of Canada who projects to be second on the production increase list.
According to a survey by the Federal Reserve Bank of Dallas, the cost of profitably drilling a shale oil well in the US has fallen to a modern low of $50 per barrel, likely ensuring the growth of the onshore shale industry for years to come. The decrease reflects many factors including softer demand from refineries and concerns about the US-China trade war’s impact on global economic demand. The US oil benchmark is currently hovering near $63 per barrel. Cost reductions and increasing production should stop crude oil prices from rising to high.
The fall in oil prices at the end of last year combined with pressure from investors has led to a slowdown in the U.S. shale industry.
Climate change is a popular topic in the U.S. right now and has been in the spotlight for the last few years, especially with the increasing volume of drilling and fracking production and the effect on our environment. Drilling and fracking operations normally can begin very quickly after evaluations, however this week in Wyoming drilling activities were blocked completely. This past Wednesday March 20, 2019 a judge blocked oil and gas drilling across 500 square miles in Wyoming, insisting that the U.S. government must consider the climate change impacts before leasing large areas of public land for drilling exploration.