Americas News
US Shale Predicted to Be Global Crude Production Leader as OPEC Ups Oil Cutback Rhetoric
The International Energy Agency (IEA) said in its annual World Energy Outlook that U.S. oil production will equal that achieved by Saudi Arabia at the height of its expansion, and increases in natural gas will surpass those of the former Soviet Union by 2025, with shale output rising to 9 million barrels per day (bpd).
Fatih Birol, executive director for the IEA, stated, "The United States will be the undisputed leader of global oil and gas markets for decades to come; there's big growth coming from shale oil, and as such there'll be a big difference between the U.S. and other producers."
The Outlook said the U.S. industry "has emerged from its trial-by-fire as a leaner and hungrier version of its former self, remarkably resilient and reacting to any sign of higher prices caused by the Organization of the Petroleum Exporting Country's (OPEC) return to active market management."
The current strength of U.S. shale is considerable too: the U.S. government said that production in December would rise for a 12th consecutive month, increasing by 80,000 bpd.
Meanwhile, Mohammad Barkindo, secretary general for OPEC, upped his cartel's feel-good rhetoric concerning the crude cutback initiative by remarking that the oil market is rebalancing at an accelerating pace, as global levels of oil inventories have fallen visibly and demand for oil is robust.
He added that he is confident the oil industry and the global economy is benefiting from the deal to cut output among major producers - which, if the U.S.'s outstanding rise is considered, is certainly accurate.
Presumably much to the delight of U.S. producers, the United Arab Emirates on Tuesday joined the chorus of members and supporters calling for OPEC to extend its cuts by expressing its confidence the cuts will continue through 2018.
Suhail al-Mazroui, energy minister for the UAE, said,"My prediction is OPEC will continue to do what it takes to rebalance the market."
He also insisted whatever decision on future policy was taken at the cartel's meeting on November 30, the UAE would be committed to it.
Last week, when predictions were rife that crude prices would hit the $80 per barrel mark before Christmas, Ben Shattuck, principal analyst for Wood Mackenzie, told Bloomberg that even $60 means "U.S. shale is off to the races in terms of production."
