Armed with improved recovery rates, innovative technology and financing, the U.S. has overtaken Saudi Arabia in crude oil production in September 2018 and is within reach of the world’s no. 1 crude oil producer – Russia.
In a strategic development, Frank Fannon, assistant secretary in the energy bureau of the U.S. state department stated, the United States is slated to be a key source of energy supplies for the growing demand globally, with innovation in technology and financing set to boost U.S. oil and gas production in the next decade.
“In the next 5-10 years, we expect to see improved recovery rates and even a doubling in some of our most prolific (gas) basins,” said Fannon. “What this means in the near-term is that the United States may double production, double export capacity and introduce new market innovation”.
Fannon made these comments during an industry conference in Singapore. At the same event, Fatih Birol, executive director of the International Energy Agency (IEA), said the United States would become the “undisputed leader” of global oil and gas production.
These comments come in the wake of the U.S. overtaking Saudi Arabia in oi production in 2018. With U.S. oil production hitting a record 11 million barrels per day (bpd), the country is within striking distance of the world’s top oil producer Russia.
According to Refinitiv Eikon data, thanks to the increase in U.S. crude oil, crude output from the world’s top 3 producers touched 33 million bpd for the first time in September 2018. This is an increase of 10 million bpd since the start of the decade.
It also means, that these top 3 producers alone can now meet one third of the global demand for crude oil.
As for gas, Birol stated, the United States, along with Australia and Qatar are slated to supply 60% of the global liquefied natural gas (LNG) by 2023.
Currently, the U.S. has only two LNG export projects that are operational with several others in the offing.