Peak Oil is You
Donate Bitcoins ;-) or Paypal :-)
Page added on October 11, 2013
US as oil producer top dog? It’s a question of timing.
So exactly when will the US shale revolution allow the world’s biggest oil consumer to topple Saudi Arabia as the biggest global oil producer?
The International Energy Agency reignited the perennial supply topic Friday with its latest monthly oil market report. According the report, the US will, at least, replace Russia as the world’s number two oil producer before mid-2014.
With US tight oil fueling near-record growth rates of non-OPEC supply, the IEA notes, the battle for the world’s top producer spot is a fitting and favorite theme (and an issue already succinctly aired in this blog entry last year.)
With close to 1 million b/d of ethanol and biodiesel production, the US is estimated to have already surpassed Russia as the world’s biggest liquids producer. Indeed, the US’ Energy Information Administration last week pegged the country’s total liquids output at 11.02 million b/d in September.
But by IEA reckoning, even without biofuels, the US will be producing 11 million b/d of oil in the second quarter of 2014, outpacing Russia’s oil output by some 140,000 b/d.
So how does the US fare against the world’s number one producer and OPEC king-pin Saudi Arabia? Understandably, the IEA doesn’t attempt to forecast OPEC production given the cartel’s price-orientated output policies.
According to the IEA, Saudi Arabia pumped a total of 10.12 million b/d of crude and 1.83 million b/d of NGLs last month, taking its total oil output to 11.95 million b/d.
Ignoring the fact that as a swing producer, Saudi Arabia can and likely will raise or cut production to influence prices, the US’ oil output would still fall short of Saudi Arabia’s current output, averaging 11.03 million b/d in 2014, the IEA predicts.
The numbers get more interesting, however, when biofuels are added back into the US production mix.
According to the EIA’s latest predictions of US output including biofuels next year, US liquids will average 11.96 million b/d in 2014 and hit 12.39 million b/d by the end of the year.
Even leaving to one side the opaque and convoluted realm of refinery gains, the US will then outgun Saudi’s current liquids output by mid-2014 when biofuels are factored in, according to EIA estimates. By all accounts, though, it may be a short-lived victory as Saudi Arabia’s giant reserves are expected to retake to the top spot in subsequent years anyway.
Perhaps more compelling than the numbers themselves is simply the pace with which the US shale revolution has rewritten global oil supply expectations.
In its World Energy Outlook published less than a year ago, the IEA made headlines predicting that the US will become the largest global oil producer… by around 2020.
12 Comments on "US as oil producer top dog? It’s a question of timing."
J-Gav on Fri, 11th Oct 2013 7:19 pm
Question: When will these people understand?
Answer: Probably never, or at least not until their hyper-macho “Oh Daddy, what a dick!” mindset is overturned by a major reality check a few years from now. That check is gonna bounce and the repercussions will be felt well into the future!
(NB – the reality check that bounces is not my invention but I like it)
DC on Fri, 11th Oct 2013 9:08 pm
12 Mbpd! From the US?! RoFL! What are they counting over there now, fry grease included in that? The US is nowhere near 12Mpbd, nor will it ever be. If you believe those numbers, then you probably also believe unemployment in your country is about 7%, that the economic recovery is well underway, and that amerika is duh greatest country in da wurld too…
Gasland 2 was on last night. Depressing stuff.
But I found it hard to feel sorry for Mr 12,000 sq foot dream home guy. But I did like that surprisingly honest politician that said the difference now is lots of white, HFCS fed ‘middle class’ amerikans are now being treated exactly the same way that US oil gov’t has treated 3rd world people that get in the way of oil extraction.
Dave Thompson on Fri, 11th Oct 2013 10:26 pm
Platts is just playing shill for the international corporate bankers, military industrial media complex. Wooing potential investors into a scheme that is doomed.
Oldmusher on Fri, 11th Oct 2013 11:19 pm
One important piece of information missing from this article; net oil production. When subtracting the energy required to discover, produce and refine the various forms of liquid fuel from the gross production how much is left? It is not “oil” that is the final determiner of the place of the U.S. as a global producer but rather how oil are we producing after EROI.
LT on Sat, 12th Oct 2013 12:27 am
Singapore, South Korea, Taiwan, Japan, Switzerland produce very little (if any) oil, and yet, their economies are significant compared to their population and land sizes.
Whereas the US produces most oil in the world, but also produces most debt in the world as well.
So, is this something we should really be proud of?
rockman on Sat, 12th Oct 2013 1:33 am
Hell yeah…a lot to be proud of. Like transferring $220 billion/year to foreign oil producers and $420 billion/year to those lying oil company bastards. BTW…thank you.
mo on Sat, 12th Oct 2013 1:59 am
Every few weeks I read another article that pushes our production numbers higher and higher. Am I missing something here, maybe slipping between universes?
BillT on Sat, 12th Oct 2013 2:30 am
“It’s a question of timing.” Yes. NEVER!
Arthur on Sat, 12th Oct 2013 12:07 pm
“Indeed, the US’ Energy Information Administration last week pegged the country’s total liquids output at 11.02 million b/d in September.
But by IEA reckoning, even without biofuels, the US will be producing 11 million b/d of oil in the second quarter of 2014”
Playing the devils advocate… I find it hard to believe that both EIA and IEA are lying about these numbers. Being wrong about projections far in the future is one thing, but this?
Yes DC, I saw Gasland2 a few months ago on youtube. It is depressing, but both producer Josh Fox and oil geopolitician Michael “third carbon age” Klare say that the fracking nightmare could very well be with us for another few decades:
http://www.atimes.com/atimes/Global_Economy/GECON-01-220813.html
Why should the fracking ‘nirwana’ be confined to the Bakken, Eagle Ford only? The potential could be everywhere.
Paraphrasing the buffet cook in the holiday resort: “would you like your planet medium or well done, sir”?
rockman on Sat, 12th Oct 2013 12:35 pm
Arthur – Frac’ng is being done today in many dozens of other formations in the US and has been common in ever producing region for over 40 years. In the 90’s the horizontally drilled and frac’d Austin Chalk in Texas was the hottest oil play on the planet…far hotter the EFS and Bakken are now. The MSM just picks where they want to focus.
shortonoil on Sat, 12th Oct 2013 4:01 pm
The EIA’s demand model has been broken for some time; if it ever did work? For a little more reality try Hughe’s 166 page study.
“Furthermore, 41 percent of the purported tight oil resource is contained in the Monterey play of
California. That this much oil can be recovered from the Monterey is highly questionable. Recent drilling
results have been disappointing and the longer-term performance of the Monterey is mostly at
“stripper well” levels (Table 5), with an average of 12.7 barrels per day from 675 wells. This bears no
comparison to the Bakken or Eagle Ford despite the early enthusiasm.”
From: Drill Baby Drill page 106
J. David Hughes
Post Carbon Institute
http://www.postcarbon.org/reports/DBD-report-FINAL.pdf
SteveK on Sat, 12th Oct 2013 6:08 pm
Oldmusher, I totally agree with your EROEI point and would like to add population and economic growth to the equation. So what if global LIQUIDS production is increasing marginally if more consumers are being added each day? The growth of the economies and middle class of OPEC producers, and consumers China and India, are outpacing production gains. How often do you see net production per capita reported? How about net available for export? Its all about the MSM’s feel good, dumbed down, over simplified, headline message. Yeah, we may be producing more liquids than Russia and Saudi Arabia. For how long? Is it because they are peaking and can’t grow production? In which case, how much better off are we really?