Thanks to the fracking and shale oil revolutions the United States is poised to become the world’s largest oil producer. The Energy Information Administration forecasts that US oil production will surpass 11 million barrels per day by 2019. The US is currently the third largest oil producer behind Russia (10.5 million barrels per day) and Saudi Arabia (10 million barrels per day).
“In 2019, EIA forecasts that the United States will average nearly 12 million barrels of crude oil production per day,” Linda Capuano, Administrator of the EIA, said in Bloomberg. “If the forecast holds, that would make the U.S. the world’s leading producer of crude.”
After declining for decades, US oil production began to surge in 2015. By November 2017, the US was producing more than 10 million barrels per day for the first time since 1970. As production rose, Congress repealed the 40-year-old ban on exporting US oil in 2015. Current forecasts show that the US could become a net exporter of oil and gas by 2022.
At the same time, it was producing more oil, the US was also using less. In 2017, US oil consumption fell for the first time in five years per Bloomberg. The decline was attributed to a number of factors that included more efficient vehicles, urban population growth than led to less driving, technology reducing the need for face-to-face meetings and an aging population that is leaving the workforce.
Nevertheless, there are a few speed bumps on the road to energy independence. Limited pipeline capacity from Texas’ Permian Basin means that production may start to slow in the area later this year. American refining capacity has also not increased with the surge in crude oil production. Oilprice.com reported that in June US refineries were running at more than 97 percent capacity.
Despite increasing oil production, the Energy Information Administration does not predict relief at the pumps for US drivers. The agency forecasts gas prices to average near their May 2018 peak for the next two years due to unrest in Venezuela, sanctions on Iran and OPEC production limits.