Monday, February 20th, 2017 and is filed under Oil and Gas Current Events, Oil and Gas Fun Facts, Permian Basin Oil News, Texas Oil and Gas Investing
As a result of expected OPEC production cuts, U.S. crude oil production could reach levels not seen since 1970. According to the EIA’s Short-Term Energy Outlook, domestic crude production could average 9.53 million barrels per day in 2018. That would be record crude production for the U.S. except for the 9.64 million barrels per day average seen in 1970.
In a recent Bloomberg article, Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts, said, “Shale operators are more bullish with crude trading above $50. Iām sure that from Riyadh to Caracas people in oil ministries are watching the U.S. rig count with avid interest and a bit of dismay.”
The Permian Basin is expected provide much of the increased production in 2018 now that cost reductions and new technology have lowered the breakeven points to $50 per barrel and below. The Wolfcamp Midland and Wolfcamp Delaware regions of the Permian have some of the best breakeven points of any shale basin in the U.S., averaging around $42 per barrel according to Wood Mackenzie.
Some of the highlights of the EIA’s Short-Term Energy Outlook were as follows:
As oil prices continue to recover and oil demand continues to grow throughout the world, we will likely see a steady uptick in domestic production and an area to keep an eye on is the Permian Basin.
RELATED >> 2017 Oil Outlook
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