Loading price data...
OilMonster
Crude Oil September 10, 2020 12:30:34 AM

Crude Oil Production Increased 11% in 2019

Anil
Mathews
OilMonster Author
Shale and tight rock formations are more accessible because of the continued advances in horizontal drilling and hydraulic fracturing.
Crude Oil Production Increased 11% in 2019

OILMONSTER.COM-  Total U.S. crude oil production rose 11%, or by 1.24 million barrels per day, in 2019, according to the U.S. Energy Information Administration (EIA).

Lighter, less dense crude oil contributed the most to the production rise, which was a result of an increase in crude oil production from shale and tight rock formations. Shale and tight rock formations are more accessible because of the continued advances in horizontal drilling and hydraulic fracturing.

U.S. refinery inputs have become lighter over the years as refineries use less of the heavier, imported crude oil and more of the lighter, domestically produced crude oil to process into petroleum products. Crude oil with a higher API gravity is lighter or less dense. Production of crude oil with an API gravity greater than 40 degrees increased from 5.8 million barrels per day in 2018 to 6.7 million barrels per day in 2019. Production of crude oil of 40 degrees or greater accounted for 57% of total production in the lower 48 states in 2019, up from 50% in 2015.

Lighter crude oil with an API gravity from 40 degrees to 50 degrees accounted for 56% of production in Texas in 2019. Crude oil in this API gravity range was the fastest-growing category overall and reached 2.9 million barrels per day in 2019. The production growth could be attributed to production increases in the tight oil plays of the Permian and Eagle Ford shale formations.

Lighter crude oil also is produced in the Bakken formation in North Dakota. Denser crude oil is produced in California and the Federal Offshore Gulf of Mexico. U.S. crude oil imports also tend to be denser.

In 2019, 96%, or 6.5 million barrels per day, of imported crude oil had an API gravity of 40 degrees or less. By comparison, 43%, or 5.1 million barrels per day, of domestically produced crude oil had an API gravity of 40 degrees or less. Imports of heavier crude oil fell 13%, or by 971,000 barrels per day, in 2019, while domestic production of lighter crude oil rose 16%, or by nearly 900,000 barrels per day.

The United States continues to import crude oil because of the variations in crude oil quality. U.S. refining capacity is configured for a range of crude oil inputs, allowing refineries to run a variety of crude oil that is most economical. Heavier crude oil tends to be priced lower than lighter crude oil and provides an incentive for refiners to run the heavier crude oil if they can do so.

The average API gravity of domestic and imported crude oil used at U.S. refineries has risen from a low of 30.2 degrees in 2004 to a record of 32.9 degrees in 2019. Since 2009, U.S. crude oil imports have fallen 23%. Over the same period, domestic production has increased by 138% and accounted for a greater share of refinery inputs.


Courtesy: www.talkbusiness.net

 

OIL MONSTER Newsletter
Subscribe to OM mailing list and get updates to your inbox