The remarkable revival of US oil production

The remarkable revival of US oil production:

"Half a century after US oil production began to peak, sending the world fretting that supplies were running out, the US is once again setting records. Output is topping 10m barrels per day for the first time since 1970. And it will not stop there. The government’s Energy Information Administration forecasts that America will soon overtake Russia as the world’s leading oil producer.

On many levels this is welcome. Soaring output from shale wells has helped to hold down world prices, benefiting consumers everywhere. It has created tens of thousands of jobs in the US, bolstered energy security and led to a dramatic reduction in net imports, which are down from a peak of 13.4m b/d in 2006 to 2.5m b/d in October 2017. This represents a remarkable reversal from even a decade ago, when one of the principal questions about the global oil market was how fast US imports were going to rise.

The shift in the structure of the industry since has been fundamental. Shale producers can bring wells in and out of production in response to price changes far more swiftly than conventional producers. That has weakened the power of Opec, the cartel of 15 oil-producing nations — which is welcome news for everyone else."



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