U.S. oil production jumped last week to the highest level since May 1989, cutting consumption of foreign fuel and putting the U.S. closer to energy independence.
Drilling techniques including hydraulic fracturing, or fracking, pushed crude output up by 124,000 barrels, or 1.6 percent, to 7.745 million barrels a day in the seven days ended Sept. 6, the Energy Information Administration said today.
Rising crude supplies from fields including North Dakota’s Bakken shale and the Eagle Ford in Texas have helped the U.S. become the world’s largest exporter of refined fuels including gasoline and diesel. Texas pumped 2.575 million barrels a day in June, according to the EIA, enough to rank it ahead of seven members of the Organization of Petroleum Exporting Countries.
“It’s amazing,” said Andy Lipow, president of Lipow Oil Associates LLC, a Houston-based consulting firm, who predicted last month that the U.S. would be pumping 7.75 million barrels a day by the end of the year. “The state of Texas is now producing more oil than the country of Iran.”
Iran produced 2.56 million barrels a day in June, according to a Bloomberg survey of oil companies, producers and analysts. Saudi Arabia, Iraq, Kuwait, the United Arab Emirates and Venezuela pumped more than Texas that month.
West Texas Intermediate, the U.S. benchmark, rose 17 cents, or 0.2 percent, to settle at $107.56 a barrel on the New York Mercantile Exchange. Brent futures advanced 25 cents, or 0.2 percent, to $111.50 on ICE Futures Europe in London.
The U.S. met 87 percent of its own energy needs in the first five months of 2013, on pace to be the highest annual rate since 1986, EIA data show. Domestic crude output will average 7.5 million barrels a day in 2013 and 8.4 million in 2014, the EIA said yesterday in its Short-Term Energy Outlook.
Rising domestic supplies have curbed consumption of foreign fuel. Net imports of crude oil and petroleum products will fall to 5.4 million barrels a day by 2014, down from 12.5 million in 2005, the EIA, a unit of the Energy Department, said in the report.
The abundance of crude has made the U.S. an increasingly important refining hub. U.S. exports of distillate fuel oil, largely comprised of diesel, rose to an all-time high of 1.285 million barrels a day in June, the EIA said Aug. 29.
Charters for product tankers from the U.S. Gulf Coast reached a record of 42 last week, according to a Sept. 6 weekly shipping report by Charles R. Weber Co., a ship broker based in Greenwich, Connecticut. About 15 of those were bound for Europe, also a record, the data showed.
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