A government official has said that he expects US oil production to reach 14 million bpd (barrels per day) by 2020.
Speaking to Fox Business, Secretary of the Interior Ryan Zinke said:
“Today we are the largest oil and gas producer on the face of the planet, rolling through 11.2 million bpd, on our way to 14.”
Zinke added that while there is plenty of production capacity to achieve this, work needed to be done on the infrastructure.
The increases in US oil production have been mostly driven by the shale regions. While major oil companies like ExxonMobil, the energy company behind Mobil UK stockists, were initially hesitant to invest in shale, this is certainly not the case anymore. Since the oil price crash, shale operators have focused on doing more with less, and in many cases now, they can make a profit even at relatively low oil prices.
Unfortunately, limited takeaway capacity in the shale regions has begun to act as a bottleneck for production. With limited pipeline capacity to the Texas Gulf Coast, the price difference between the WTI and Brent benchmarks has widened.
While more pipelines are planned to ensure that oil can make it to the Gulf Coast for export, these are not expected to come online until late 2019 or 2020, which likely explains Secretary Zinke’s use of the year 2020 for his 14 million bpd prediction. The US Energy Information Administration currently estimates oil production of 11.8 million bpd for 2019.