Photograph by Joshua Ardoin a SpotOn Houston Commercial Photographer.
According to the latest Petroleum Supply Monthly from U.S. Energy Information Administration, U.S. monthly crude oil production surpassed 12 million barrels per day for the first time in April 2019. The U.S. produced 12.16 million b/d in April – up 246,000 b/d or 2.06 percent from a month earlier. The EIA added, “This milestone comes less than a year after U.S. crude oil production surpassed 11 million b/d in August 2018.” Production in the nation’s top producing state, Texas, was up 11,000 b/d to a record 4.97 million b/d. Federal Offshore Gulf of Mexico and Oklahoma also produced record volumes.
Reuters reported, “Booming shale production from places such as Permian Basin of west Texas have enabled U.S. oil output to overtake Saudi Arabia and Russia.” Jim Lucier of Washington, D.C.-based Capital Alpha Partners, told reporters, “Despite all the talk about Wall Street forcing capital discipline, we’re not seeing any diminishing production yet.”
EIA said Permian Basin accounts for 63 percent of Texas production and 96 percent of New Mexico production.
Stats from PB Oil and Gas magazine.
I expect West Texas Intermediate oil prices to range between $52.50 and $62.50, consistent with the range in my last two months’ forecast.
There was a lot of volatility in oil prices in September. There was an attack on Saudi Arabia’s infrastructure, and although Saudi Arabia’s exports have recovered to near prior levels, there are still questions remaining as to how quickly Saudi Arabia’s infrastructure can be fully repaired. Adding to the uncertainty is the impeachment investigation in the US. My own view is that one should largely tune out the political noise until such time as there are consequences that affect supply and demand.
