In less than ten years U.S. oil companies have drilled 114 thousand wells, many of these companies already can make a profit even if the price of oil to 30 dollars per barrel. With high probability, American oil producers will continue to increase production, that will be a big headache for many manufacturers of “black gold” – especially for OPEC, which is trying to control the price of oil.
According to the Agency Bloomberg, OPEC’s problems will only get worse next year, when producers of us shale oil in the Permian basin in Texas, would build three pipelines, and will produce 2 million barrels of oil per day.
As noted in the publication, oil production in the region will continue to grow, and OPEC will have to adapt to new conditions, says Mike Loya, a top Manager of one of the largest in the U.S. the company Vitol Group.
The shale revolution in the United States poses to OPEC with one of the most serious problems in the last 60 years. If Saudi Arabia and its allies will cut oil production to balance the oil market and not to let the prices drop too low, producers of shale oil will thrive, depriving the producers from other countries their share in the world market of «black gold». However, Saudi Arabia needs higher oil prices to balance the country’s budget, while American manufacturers satisfied with smaller prices. Therefore, OPEC is unlikely to allow oil prices too fell sharply, says Bloomberg.
In December, 15 members of the OPEC and the OPEC participants of the transaction+, including Russia and Kazakhstan will gather at the summit of the cartel, to assess the situation. In the article, the Agency notes that OPEC itself has helped to create a monster which in 2014 has fallen off the world oil market. Then oil prices collapsed, survived, though not all producers of shale oil, but those who kept mining, I learned to minimize their costs. They have preserved the «extra» wells, but when the oil began to go up them again reactivated, continuing the drilling.
Currently, the volume of shale producers in the United States is increasing, and this growth only accelerated, that threatens, according to the Agency, «flood of biblical proportions» because the global oil market may again fall.
Oil production in the United States in August was the biggest for 98 years. According to the publication, produced a total of 15.9 million barrels per day – more than in Russia or Saudi Arabia.
Such growth became possible because the traders did not slow down the shipment of raw materials due to lack of capacity of pipelines. They used rail cars and even trucks to send oil from the region. But then a pipeline company suddenly increased the power by adding in pipes of chemical substances to «reduce the resistance», as a result, the amount of bleeding increased.
Today, the shale oil companies are sure that the power leveling in 2019 will be higher, so companies in the region increase their activity on drilling wells. While many of the well is a kind of storage tanks for finished products, which is waiting for the commissioning of new pipelines.
The only thing that is holding back the American oil producers in Texas, says Bloomberg, it’s a limitation of the export potential that is still limited — as long as, for example, the participants in the transaction OPEC+ will not start to reduce production. If this happens, it is partly their place in the oil market can take us exporters. Also a particular problem for kancevica USA are storage tanks, which is currently almost filled to capacity.
According to the energy information Administration of the United States, by the end of 2019, the total oil production in the U.S., including NGLs, will rise to 17.4 million barrels a day. Against this background, the import of oil by the United States in December 2019 will decrease to 320 thousand barrels per day, which would be the lowest figure since 1949, when the White house was Harry Truman. Some experts even make a prediction: the probability that the United States can become even for some time a net exporter of oil, which had almost 75 years.
Meanwhile, Saudi Arabia also recognize that the increase in oil production in the United States carries great issues the countries of the cartel. According to estimates by OPEC to balance the market and avoid increasing oil reserves in 2019, the cartel has exported about 31.5 million barrels a day.
World oil demand still absorb additional barrels of oil from the USA, limiting the impact on prices. The production decline in Venezuela and Iran is even allowed in Saudi Arabia, Russia and some other oil producers to increase their exports, but for OPEC, American shale production is still a big headache, because you always have to consider that the U.S. kancevica always ready to occupy the vacant niche in the global oil market, according to the publication Bloomberg.