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FILE - US reigning champion in oil, natural gas

FILE - US reigning champion in oil, natural gas
US becomes world's largest crude oil and natural gas producer because of shale revolution

By Ovunc Kutlu

ANKARA (AA) - The US is still the reigning champion in crude oil and natural gas production despite coronavirus-related quarantine measures that are causing low demand and a cutback in oil and gas output.

With the shale revolution, which enabled the widespread use of methods such as hydraulic fracturing and horizontal drilling, the US' crude oil production soared from an annual average of 5 million barrels per day (bpd) in 2008 to a record high level of 13.1 million bpd for the week ending Feb. 28, 2020, according to the country's Energy Information Administration (EIA).

However, due to weak oil demand and low oil prices caused by COVID-19, US crude oil production fell to 11.6 million bpd for the week ending May 8, and is expected to average 11.7 million bpd in 2020, according to the EIA.

The US still comes on top in terms of total crude oil and global oil product output with an annual average of 15.3 million bpd in 2018, according to the latest data available based on BP’s Statistical Review of World Energy report released last year.

It was followed by Saudi Arabia with an average of 12.2 million bpd in 2018, and Russia based on an average of 11.4 million bpd, the report showed.

- Crude imports down, exports up

The shale oil revolution helped the US to gradually lower the volume of crude oil imports over the years and also helped it to begin the export of crude oil.

In late 2015, Former US President Barack Obama lifted the self-imposed ban on the export of domestically produced crude oil that had been implemented in the country since the 1970s.

Since then, US crude oil exports increased from an average of 591,000 bpd in 2016 to a record high level of 3.71 million bpd in February 2020, the EIA showed.

During the first seven months of 2019, the US exported crude oil to as many as 31 destinations per month, according to the EIA.

As for imports, the US held the all-time annual high record of 10.12 million bpd of crude imports in 2006 before the shale revolution started. This level declined to an annual average of 6.79 million bpd in 2019, and to as low as 5.81 million bpd in November last year.

The US continues to import most of its crude from its northern neighbor Canada, which averaged 3.81 million bpd last year.

However, the US continues to rely heavily on the Middle East where US imports from Saudi Arabia averaged 500,000 bpd in 2009, according to the EIA data. However, that level is significantly down from the all-time highest level of 1.7 million bpd recorded in 1991 right after the Gulf War.

After Saudi Arabia, Mexico ranks second with US imports from its southern neighbor reaching an annual average of 600,000 bpd in 2019.

- Natural gas

Since the shale revolution, US natural gas production also jumped from 21.1 trillion cubic feet (597.5 billion cubic meters) in 2008 to 36.2 trillion cubic feet (1.02 trillion cubic meters) in 2019, according to the EIA data.

The US is still the world leader when it comes to natural gas production, which averaged approximately 832 billion cubic meters in 2018, according to BP’s Statistical Review of World Energy report.

Russia followed that year with 669 billion cubic meters of natural gas production, while Iran was in third place with 239 billion cubic meters of gas output, the report showed. Qatar, the world's reigning LNG export champion for more than a decade, fell to fourth place in 2018 with 175 billion cubic meters of gas production.

Canada is still the top country for supplying the majority of US natural gas imports and constitutes almost all of the US’ gas purchases via pipeline.

In 2019, US gas imports from Canada totaled 2.68 trillion cubic feet (75.9 billion cubic meters), the EIA data showed.

As for liquefied natural gas (LNG) in 2019, the US imported the most LNG from Trinidad with an average of 46.8 billion cubic feet (1.32 billion cubic meters).

That was followed by Nigeria with 3.1 billion cubic feet (87.8 million cubic meters) and France with 2.6 billion cubic feet (73.6 million cubic meters), according to the EIA data.

- LNG export projects

The US started exporting more natural gas than it imports on an annual basis in 2017 due to increased LNG exports, the rise in pipeline exports to Mexico, and fewer gas imports from Canada.

The US began exporting LNG from Lower 48 states, excluding Mexico, in February 2016, when Cheniere Energy's Sabine Pass liquefaction terminal in the US state of Louisiana shipped its first cargo overseas.

Since then, the Cove Point LNG export facility began operations in Maryland, and the Corpus Christi facility in Texas started exporting LNG in 2018.

Two more LNG export facilities, Cameron LNG in Louisiana and Freeport LNG in Texas were also commissioned, while Elba Island LNG facility in Georgia, is close to becoming fully operational for LNG exports.

According to the EIA data, US LNG exports only stood at 3.3 billion cubic feet in February 2016 when there was only one terminal, and soared to the all-time highest level of approximately 250 billion cubic feet (7.1 billion cubic meters) in January 2020.

source: News Feed
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