Headlines: U.S. Now World’s Top Producer of Oil

October 18, 2013 – If you think fossil fuels are going away because we are all more aware of the threat they represent to our global climate, well then check out this dose of reality.

According to the PIRA Energy Group, slated to be the expert in this field, the United States oil supply from domestic sources will average 12.1 million barrels per day. That is larger than Saudi Arabia by 0.3 million barrels per day, the previous leader. Russia slips to third producing 10.5 million barrels per day.

The definition of oil in this calculation covers all condensates: crude oil, liquid natural gas (LNG) and biofuels. Today the U.S. crude oil production amounts to 7.4 million barrels per day (3 million barrels less than Saudi and Russian production). LNG production amounts to 2.5 million and biofuels, 1.3 million barrels per day. One-third of U.S. crude production today comes from shale oil and this source has been growing on average by 800,000 barrels per day. PIRA sees U.S. production maintaining its number one position until at least 2030 although the rate of growth from shale oil sources is expected to lessen.

Today the U.S. processes approximately 15 million barrels of crude oil per day in domestic refineries. That is twice as much as domestic crude production. If production of shale oil continues to grow at the current rate while demand decreases as automobiles become more fuel efficient it looks like around 2020 when the country will achieve self sufficienvy. Which brings up the issue of the necessity of the Keystone XL pipeline to meet domestic demand. Does it make sense to build a pipeline largely delivering crude oil to Texas refineries if rising domestic supply can meet the future capacity of those facilities? But that is a subject for another time.