Spurred by drilling across Texas and led by the Eagle Ford Shale and Permian Basin, crude oil production in Texas rose more than 23 percent in August compared to August 2013, according to the Texas Petro Index.
Oil production totaled an estimated 95.56 million barrels in August compared with 77.6 million barrels in August 2013, according to economist Karr Ingham, who developed and maintains the Texas Petro Index.
In addition, the 307,700 employees who are estimated to work for drilling and oil-field service companies surpassed 300,000 for the second time since the index was launched in 1995. Employment rose 8.3 percent for the month compared to August 2013.
“It was another strong month, even though crude oil prices declined,” said Ingham, who prepares the index for the Texas Alliance of Energy Producers, a state association of independent oil and gas producers.
With the state’s crude prices in August averaging $92.70 a barrel, the value of oil from Texas wells totaled almost $8.86 billion, 22 percent more than in August 2013.
Texas’ natural gas output was estimated to be 703.7 billion cubic feet, a year-over-year monthly increase of about 0.5 percent.
The value of Texas-produced natural gas was $2.63 billion in August, an 8 percent increase compared to August 2013, as the prices of gas in August averaged $3.74 per thousand cubic feet.
Ingham noted that average oil prices in August were down about $10 or $12 a barrel from June’s prices.
“I don’t have too much doubt that we’ll begin to see these numbers flattening a little bit if (oil) prices remain the $90 range or go lower,” he said.
But if oil prices stay about the same as at present, he doesn’t expect to bring about “any wholesale scale-back” in exploration and production activity.
And it’s a plus that rising U.S. domestic oil production adds an element of stability to fuel prices, especially for gasoline.
The beginning of the U.S. bombing campaign in Syria and Iraq last week “was met with absolutely no response at all in terms of spiking prices in crude oil markets,” Ingham said.
“You’d expect that at least for a few days it would cause crude oil prices to spike upward, and that didn’t happen at all.”
There has been such an increase in domestic production that “that’s in part what’s pushing prices lower,” he said.
“We have great supply, lower prices and very welcome stability, at least for the time being.”