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Rising US oil production frustrates OPEC+ cuts
Posted on 2/4/24 at 7:30 pm
Posted on 2/4/24 at 7:30 pm
quote:
LONDON, Feb 1 (Reuters) - U.S. oil and gas drilling has slowed in response to the fall in prices over the last 18 months, but that has not yet translated into slower production, keeping prices under pressure.
Exploration and production firms have continued to increase output despite drilling fewer wells, by concentrating on the best sites, accelerating drilling times and boring longer horizontal sections for each well.
In the oil market, efficiency gains have frustrated efforts by Saudi Arabia and its allies in OPEC? to drain global oil inventories and boost prices.
In gas, where there is no equivalent of OPEC?, continued production growth has kept prices close to three-decade lows in real terms.
The critical question is how much longer efficiency gains can keep driving significant output growth without an increase in prices and drilling.
quote:
Production from the Lower 48 states excluding federal waters in the Gulf of Mexico hit 11.0 million b/d for the first time (“Petroleum supply monthly, opens new tab”, EIA, January 31, 2024).
Lower 48 output had increased by 873,000 b/d (9%) compared with the same month a year earlier and there was no sign of growth decelerating significantly.
Total production from the Lower 48 and other areas was up by 28 million barrels in November 2023 compared with the same month in 2022.
For the first 11 months of 2023, total production increased by 337 million barrels compared with the same period in 2022.
Persistent growth in U.S. production is one reason prices have remained around $70-80 despite multiple rounds of output cuts by Saudi Arabia and its allies.
LINK /
This post was edited on 2/4/24 at 7:37 pm
6
Posted on 2/4/24 at 7:42 pm to ragincajun03
quote:
The critical question is how much longer efficiency gains can keep driving significant output growth without an increase in prices and drilling.
Posted on 2/4/24 at 7:45 pm to ragincajun03
'Merica
Posted on 2/4/24 at 7:47 pm to ragincajun03
I'm waiting to hear the spin during election season how this is bad for Biden.
U.S. oil production hit a record under Biden. He seldom mentions it. (WaPo)
quote:
U.S. oil production hit a record under Biden. He seldom mentions it.
You won’t hear President Biden talking about it much, but a key record has been broken during his watch: The United States is producing more oil than any country ever has.
The flow of huge amounts of crude from American producers is playing a big role in keeping prices down at the pump, diminishing the geopolitical power of OPEC and taming inflation. The average price of a gallon of regular gasoline nationwide has dropped to close to $3, and analysts project it could stay that way leading up to the presidential election, potentially assuaging the economic anxieties of swing-state voters who will be crucial to Biden’s hopes of a second term.
But it is not something the president publicly boasts about. The politics of oil are particularly tricky for Democrats, whose chances for victory in the 2024 elections could hinge on whether young, climate-conscious voters come out in big numbers. Many of those voters want to hear that Biden is doing everything in his power to keep oil in the ground.
Regarding that last line, it's counterintuitive, but maybe Republicans should loudly praise Biden for raising oil production to record levels. That would definitely annoy a lot of lefties.
Posted on 2/4/24 at 7:53 pm to TouchedTheAxeIn82
quote:
maybe Republicans should loudly praise Biden for raising oil production to record levels.
That would be awesome.
Posted on 2/4/24 at 8:00 pm to TouchedTheAxeIn82
quote:
Regarding that last line, it's counterintuitive, but maybe Republicans should loudly praise Biden for raising oil production to record levels. That would definitely annoy a lot of lefties.
I think that's the main reason you're seeing this ploy of holding up approvals of new LNG export facilities. He has to make sure the hard core lefties don't sit home or vote for some 3rd party candidate.
Posted on 2/4/24 at 8:48 pm to TouchedTheAxeIn82
The credit for the rise in oil production in the U.S. obviously goes to the oil companies and not Joe Biden.
The Biden administration has done everything in their power to stimulate alternate forms of energy production, lining Democrat pockets in the process.
The Biden administration has done everything in their power to stimulate alternate forms of energy production, lining Democrat pockets in the process.
Posted on 2/4/24 at 10:24 pm to ragincajun03
As Milton Friedman said, the market figures out a way.
Posted on 2/4/24 at 10:42 pm to ragincajun03
Then why is gas still right at $3 a gallon? Why now $1.69 when the last administration was in office?
Posted on 2/4/24 at 11:34 pm to LSUDad
quote:
Why now $1.69 when the last administration was in office?
The national average was only below $2 for 2/3 months during the last administration.
But the price of gas being higher probably is related to refineries and their maximum capacities.
Posted on 2/4/24 at 11:45 pm to GurleyGirl
quote:That doesn't have anything to do with the topic of this thread.
The Biden administration has done everything in their power to stimulate alternate forms of energy production, lining Democrat pockets in the process.
Posted on 2/4/24 at 11:55 pm to ragincajun03
They need to understand it is an election year baw. With this shite economy this administration is chanting drill baby drill at a whisper. Thier hope is that the climate retards don't get wind of this.
Posted on 2/5/24 at 5:20 am to LSUDad
quote:
Why now $1.69 when the last administration was in office?
The price of oil also isn’t $20/bbl right now due to crashed demand.
Posted on 2/5/24 at 6:03 am to Obtuse1
quote:
But the price of gas being higher probably is related to refineries and their maximum capacities.
This is the correct answer.
Refining totals, gross inputs & capacity are all still well below pre-COVID levels.
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