U.S. Shale Surge Offsets Lowest Saudi Oil Imports Since 1980s
(Bloomberg) -- America’s role in the global oil market was flipped on its head in 2017. As shale producers cranked out more and more crude, the U.S. relied less and less on some of its traditional sources of oil. At the same time, exports of crude, gasoline and other refined fuels surged higher than ever before.
The U.S. bypassed Saudi Arabia late last year and is nipping on the heels of Russia to be the world’s biggest oil producer. November output hit a record of 10.057 million barrels a day after the Energy Information Administration revised its data upward. U.S. frackers ramped up production as prices rose toward $60 a barrel late in the year, drawing more drillers to the market.
Two of the most-watched members of the Organization of Petroleum Exporting Countries sent less crude to the U.S. -- one by choice, and one not so much. Saudi deliveries fell as planned production cuts were implemented to help balance the market and support prices. Venezuela’s hit came amid U.S.-imposed financial sanctions and shrinking production. Meanwhile, imports from Iraq jumped to help keep OPEC steady.
Fueling the World
Last year, exports of crude, gasoline and distillates all rose to record highs, and combined shipments abroad finished off the year at 7.3 million barrels a day in December, the largest volume ever in EIA data. The export machine will likely keep running at full steam in 2018. Demand for refined products may continue to strengthen from Latin America as local refineries struggle to stay in good keep. Gulf Coast crude exports have more potential, too, now that the Louisiana Offshore Oil Port can load supertankers.
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