The United States is experiencing its greatest increase in oil drilling since 2012 following cuts in production by the Organization of Petroleum Exporting Countries (OPEC) in cooperation with 11 other countries.
These recent production cuts, which saw Saudi Arabia cut its production by the greatest amount for eight years, have helped stabilise oil prices above $50 a barrel for the past two months. Good returns are very achievable at this price, and this has led to a drilling boom in many shale areas, with the Scoop and Stack formations in Oklahoma and the Permian Basin of West Texas and New Mexico leading the way.
While the rig count in the US hit a low in May 2016, some 281 rigs have since been brought back on line. This is the biggest increase the industry has seen since rigs increased by 361 over nine months in 2012. This year also enjoyed a great start, with 72 rigs being already added. According to the Energy Information Administration, US crude inventories are also at their highest level since 1982, with them reaching 518.1 million barrels one week in February.
Industry players like Royal Dutch Shell, which also produces industrial lubricants like Shell Omala S2 G 320, have developed techniques to convert the kerogen in oil shale to shale oil, which can then be refined and used in applications similar to those of crude oil derivatives. The industry claims that shale oil and gas have the potential to revolutionise energy supply.