United States Takes The Crown

The United States of America is now the highest producer of crude oil in the World. The United States experienced a huge leap in its crude oil production in 2018 compared to the previous year. The growth in oil production in Texas and the Permian and Bakken region were critical in the emergence of the United States. According to Baker Hughes, in April an average of 449 rigs was drilling holes in Permia, this was a significant proportion of the rig drilling activities both in the United and globally. In April oil production in Permia increased to 3.2 mb/d. This increased drilling activity is due to the shale revolution, in which horizontal drilling and industrial-scale hydraulic fracturing (fracking) of subterranean rock which seen as impossible due to the cost implication. The Permian on the other hand has multiple layers of oily shale and it is expected that oil production in the region to increase to the level in which it will account for two-thirds of the oil growth from the United States of America due to the availability of stack of pays and the growing rate of extensive oil-producing infrastructure makes future oil production from the region.  The United States invested hugely in the fracking of Shale oil and this paved the way for United States’ emergence as a world energy leader. The price of crude oil also played a significant role, beyond the breakthrough in oil drilling. The price of oil was reasonable enough for energy companies to recoup the huge investment incurred in fracking technology and this explains why the production rate is quite high.

The United States has thus been able to manage its demand for a crude product which has been growing steadily thanks to the improving state of the economy. Though the United States is the world-leading producer of crude oil, yet its production is not sufficient to meet domestic demand thus, it imports crude oil from Canada and OPEC members which it refines and uses for domestic consumption and export. A significant impact of the increase in crude oil production by the United States is the impact of the domestic price of crude oil products, the price of crude oil products has been reducing relatively to what obtains in the global market and this has stimulated the economy by reducing the growth of prices and also reducing the cost of production.

Oil rig. Source: Marcellus

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