Crude oil production in the United States has reached 12.4 million barrels per day (bpd). This is according to the Energy Information Administration’s (EIA) recent Weekly Petroleum Status Report, with these numbers on course to beat the previous yearly record in 2019.
While this is someway off the shorter-term record in November 2019 of 13.0 million bpd, it is 400,000 bpd more than the same point in 2022, despite the number of rigs having declined by 5% over the same period, according to Baker Hughes. Interestingly, the Permian Basin is now producing more crude oil than the massive Ghawar oilfield in Saudi Arabia, having reached a new record of 5.8 million bpd.
In the Permian Basin, oil majors like Chevron and ExxonMobil, the makers of the Texaco and Mobil lubricant products, extract shale oil resources using modern techniques like hydraulic fracturing, which is commonly known as fracking. The area has witnessed rapid production growth over the last decade, but the pace has started to slow more recently as declining production from legacy wells has offset the added production from new wells.
Recent production has been mostly driven by using drilled-but-uncompleted (DUC) wells. The number of these wells has almost halved over the past three years, with there being a 6% drop over the past year. This means while further production gains could be achieved with the remaining DUC wells, any substantial increase in oil production will require greater drilling activity. Such decisions to drill more wells will ultimately depend on the direction of oil prices.