Oil prices fall as U.S. crude output hits record 12m bpd

Oil rig used to illustrate the story.
Oil rig used to illustrate the story.

Oil prices fell on Friday after the United States reported its crude output hit a record 12 million barrels per day (bpd), undermining efforts by Middle East-dominated producer club OPEC to withhold supply and tighten global markets.

International Brent crude futures were at 66.87 dollars per barrel at 0326 GMT, down 20 cents, or 0.3 per cent, from their last close.

U.S. West Texas Intermediate (WTI) crude oil futures were at 56.84 dollars per barrel, down 12 cents, or 0.2 per cent, from their last settlement.

U.S. crude oil production reached 12 million bpd for the first time last week, the Energy Information Administration (EIA) said on Thursday in a weekly report.

That means U.S. crude output has soared by almost 2.5 million bpd since the start of 2018, and by a whopping 5 million bpd since 2013.

America is the only country to ever reach 12 million bpd of production.

As output surges, U.S. oil stocks are also rising.

U.S. commercial crude oil inventories rose by 3.7 million barrels to 454.5 million barrels in the week ended Feb. 15, the EIA said.

Analysts say U.S. output will rise further and that oil firms will export more oil to sell off surplus stocks.

“We see total U.S. crude production hitting 13 million bpd by year-end, with 2019 averaging 12.5 million bpd,” U.S. bank Citi said following the release of the EIA report.

Of that, the bank said, “We could be seeing some weeks with 4.6 million bpd of gross crude exports by end-year, adding to this week’s new record” of 3.6 million bpd.

Friday’s dips at least temporarily halted a rally that pushed crude prices this week to their highest for 2019 so far amid the supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC).

OPEC and some non-affiliated producers such as Russia agreed late last year to cut output by 1.2 million bpd to prevent a large supply overhang from growing.

Advertisement

RIPAN Campaign AD

Another recent price driver has been U.S. sanctions against oil exporters Iran and Venezuela. (Reuters/NAN)

Support PREMIUM TIMES' journalism of integrity and credibility

Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.

For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.

By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.

Donate


NEVER MISS A THING AGAIN! Subscribe to our newsletter

* indicates required

DOWNLOAD THE PREMIUM TIMES MOBILE APP

Now available on

  Premium Times Android mobile applicationPremium Times iOS mobile applicationPremium Times blackberry mobile applicationPremium Times windows mobile application

TEXT AD: This space is available for a Text_Ad.. Call Willie on +2347088095401 for more information


All rights reserved. This material and any other material on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from PREMIUM TIMES.