U.S. Remains Top Producer Of Petroleum and Natural Gas
For the U.S. and Russia, total petroleum and natural gas hydrocarbon production, in energy content terms, is nearly evenly split between petroleum and natural gas. Saudi Arabia’s production, on the other hand, heavily favors petroleum. Total petroleum production is made up of several different types of liquid fuels, including crude oil and lease condensate, tight oil, extra-heavy oil, and bitumen. In addition, various processes produce natural gas plant liquids, biofuels, and refinery processing gain, among other possible liquids fuels.
In the U.S., crude oil and lease condensate accounted for roughly 60% of total petroleum hydrocarbon production in 2015. An additional 20% was natural gas plant liquids. Biofuels and refinery processing gain make up most of the remaining U.S. petroleum and other liquids production volumes.
Throughout 2015, U.S. crude oil prices remained relatively low, with the spot prices of West Texas Intermediate crude oil declining from $47/bbl in January to $37/bbl in December. Despite low crude oil prices and a 60% drop in the number of operating oil and natural gas rigs, U.S. petroleum supply still increased by 1 MMbbld in 2015. U.S. natural gas production increased by 3.7 Bcfd, with nearly all of the increase occurring in the eastern U.S.
Increases in U.S. petroleum and natural gas production over the past several years are directly attributed to production from tight oil and shale gas formations. Several factors kept hydrocarbon production increases in Russia smaller than the increases in the U.S. in 2015. Although Russian petroleum production continued to rise, natural gas production declined because of poor economic conditions and a mild winter, which resulted in lower domestic demand for natural gas. Russia’s total combined production of petroleum and natural gas increased by just 0.1 quadrillion Btu in 2015.
In contrast to past actions to raise or lower oil production levels to balance global oil markets, Saudi Arabia did not reduce petroleum production in late 2014 or 2015, even as oil prices fell and global inventories rose. As a result, Saudi Arabia’s total petroleum and natural gas hydrocarbon production increased by 3% in 2015. Still, the U.S. produced more than twice the petroleum and natural gas hydrocarbons as Saudi Arabia last year.
In EIA’s May “Short-Term Energy Outlook,” U.S. petroleum and other liquid fuels production is expected to decline from 15 MMbbld in 2015 to about 14.5 MMbbld in both 2016 and 2017. In contrast, the outlook forecasts Russian liquid fuels production to remain at about 11 MMbbld through 2017. e energy outlook publishes a production forecast for Middle Eastern members of OPEC as a whole rather than for individual countries in the region. However, there is currently no indication now that Saudi Arabia plans to reduce its current level of petroleum production.
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