U.S. production of crude oil grew 5% in 2017, reaching 10 million barrels per day in the last two months of the year
https://www.eia.gov/petroleum/weekly/March 14, 2018
Annual average U.S. crude oil production grew by 463,000 barrels per day (b/d) in 2017 to 9.3 million b/d after declining by 551,000 b/d in 2016. In November 2017, monthly U.S. crude oil production grew 1.2 million b/d year-over-year and reached the highest level of production in U.S. history, surpassing 10 million b/d, a level last reached in 1970 (Figure 1). U.S. crude oil production has increased significantly over the past 10 years, driven mainly by production from tight rock formations using horizontal drilling and hydraulic fracturing. EIA projects that U.S. crude oil production will continue growing in 2018 and 2019, averaging 10.7 million b/d and 11.3 million b/d, respectively.
Texas remained the largest crude oil-producing state in 2017, averaging 3.5 million b/d. Texas also grew annual production more than all other states and the Federal Offshore Gulf of Mexico (GOM) in 2017, growing by 298,000 b/d (Figure 2). Significant growth occurred in several productive plays within the Permian region in Texas. Growth in the Permian also drove New Mexico to the second-largest growth rate in 2017 with a 74,000 b/d increase.
New Mexico surpassed California and Alaska to become the third-largest crude oil-producing state in the second half of 2017, although it produced less on an annual average basis. In the GOM, new projects and expansions that started in 2016 ramped up production in 2017, which, along with two other projects that began in 2017, contributed to 51,000 b/d of annual growth. Production levels in Colorado, Oklahoma, and North Dakota each grew by more than 30,000 b/d from 2016 to 2017, while Alaskan production increased only slightly. California’s production declined 34,000 b/d, the state’s third consecutive annual decline.
U.S. onshore crude oil production growth in 2017 occurred almost entirely in the Permian basin, most of which is situated in West Texas and Southeast New Mexico. Permian crude oil production grew by 460,000 b/d from 2016 to 2017, accounting for 93% of the growth in the regions covered in EIA’s Drilling Productivity Report (DPR), which covers 62% of U.S. production. (Figure 3). The Anadarko, Bakken, and Niobrara crude oil-producing regions grew by less than 50,000 b/d each from 2016 to 2017, and production in the Eagle Ford declined by 65,000 b/d. The Eagle Ford region’s production declined on an annual average basis, although monthly production in the region began growing on a year-over-year basis in the fourth quarter of 2017, and ended the year 101,000 b/d higher in December. With the exception of the Haynesville region, which is largely a natural gas play, monthly production in all regions in the DPR had grown year-over-year by the end of 2017, collectively up by almost 1.4 million b/d from December 2016 to December 2017.
As a result of the increases in crude oil production in onshore tight oil basins and declines in other areas, total U.S. crude oil, on average, became lighter, shown by an increase in API gravity. Crude oil production with an API gravity between 40.1 and 45.0 degrees grew by 281,000 b/d to more than 2.8 million b/d in 2017 (Figure 4). Crude oil of this quality represented 32% of total U.S. Lower 48 states production in 2017, an increase from 28% in 2015, the earliest year for which EIA has oil production data by quality.
In its March 2018 Short-Term Energy Outlook (STEO), EIA projects that U.S. crude oil production will average 10.7 million b/d in 2018, which would mark the highest annual average U.S. crude oil production level, surpassing the previous record of 9.6 million b/d in 1970. EIA forecasts that crude oil production will continue to increase in 2019 to an average of 11.3 million b/d.
