The U.S. Energy Information Administration (EIA) said on Thursday that based on a latest outlook report, U.S. crude oil production will continue to increase through 2019 to hit record level.
EIA forecast in its August Short-Term Energy Outlook (STEO) that U.S. crude oil production will average 10.7 million barrels per day in 2018 and 11.7 million barrels per day in 2019. If realized, both of these forecast levels would surpass the previous record of 9.6 million barrels per day set in 1970.
This national increase is almost entirely driven by tight oil. In particular, the Permian region in western Texas and eastern New Mexico is expected to account for more than half of the growth in crude oil production through 2019.
EIA expects Permian regional production to average 3.3 million barrels per day in 2018 and 3.9 million barrels per day in 2019.
However, recent pipeline capacity constraints have dampened wellhead prices for the Permian region's oil producers. Lower wellhead prices in the region are contributing to slower growth in Permian crude oil production in 2019 compared with 2018.
On Wednesday, EIA reported U.S. crude oil production during last week hit 11 million barrels per day which was 100,000 barrels per day higher than the previous week. Meanwhile, U.S. net imports averaged 6.36 million barrels per day last week, down by 1.05 million barrels per day from the previous week.
