U.S. crude production climbed to the highest level in at least three decades last week as the shale boom moved the country closer to energy independence.
Output rose 0.4 percent to 8.97 million barrels a day, according to weekly Energy Information Administration estimates that began in January 1983. The EIA’s monthly data, which goes back to 1920 and is based on data collected by state and federal agencies, shows production at the highest since 1986.
“U.S. crude production continues to grow strongly,” Katherine Spector, a commodities strategist at CIBC World Markets Inc. in New York, said by phone.
The combination of horizontal drilling and hydraulic fracturing, or fracking, has unlocked supplies from shale formations in the central U.S., including the Bakken in North Dakota and the Eagle Ford in Texas. The surge in production has helped push oil prices down 16 percent this year to a two-year low on Oct. 27.
The higher output is filling storage tanks across the country. U.S. inventories climbed by 2.06 million barrels to 379.7 million barrels in the week ended Oct. 24, according to the EIA report.
The weekly data are based on estimates and isn’t revised, while the monthly numbers are a complete data series that’s updated, Jonathan Cogan, a Washington-based spokesman for the agency, said by phone.
Production Growth
U.S. crude production will grow by a million barrels a day this year and next to reach 9.5 million in 2015, the most since 1970, the EIA said in its monthly Short-Term Energy Outlook on Oct. 7.
“We’re still optimistic about shale growth but see the pace slowing,” Sarah Emerson, managing principal of ESAI Energy Inc. in Wakefield, Massachusetts, said by phone. “When we look back I believe 2014 will be the year of the fastest growth. We don’t see the Bakken and Eagle Ford experience being replicated in other finds.”
West Texas Intermediate crude for December delivery rose $1.25, or 1.5 percent, to $82.67 a barrel at 12:30 p.m. on the New York Mercantile Exchange.
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