US February Crude Oil Production to Offset OPEC Cuts

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Between February of 2017 and February of 2018, U.S. crude oil production from seven major shale regions is forecast to rise by 1.8 million barrels of oil per day to 6.55 million. Next month alone the total is expected to rise by 111,000 barrels a day.

That increase in daily U.S. production from its shale fields is equal to the production cuts initiated in January of last year by OPEC and its allies.

The forecast was published Tuesday by the U.S. Energy Information Administration (EIA) in its monthly Drilling Productivity Report. Total production in January is forecast to reach 6.438 million barrels a day, an increase of 24,000 a day compared with previously estimated December production.

In August the drilling productivity report added production from the Anadarko Basin of Oklahoma and Texas and combined the Marcellus and Utica basins into a single Appalachia region.

In December the number of drilled but uncompleted wells rose by 156 to a total of 7,493, including 137 new wells in the Permian Basin.

No overall oil production declines are forecast either for January or February, and production from new wells is looking for an increase in production of eight barrels per day per rig. Production from new rigs is either expected to rise or remain flat from January to February.

Natural gas production is expected to rise by a total of 890 million cubic feet per day, with Appalachia production up by 377 million cubic feet per day. Production in the Permian Basin is expected to rise by 209 million cubic feet in February. Haynesville gas production is forecast to rise by 198 million cubic feet per day, and Niobrara production is expected to be up by 43 million cubic feet per day.

Benchmark West Texas Intermediate (WTI) crude oil for February delivery settled Monday at $63.73 a barrel, down nearly 1% from Friday’s closing price of $64.20.

Natural gas for February delivery settled Monday at $3.13 per million BTUs, down about 2.1% from Friday’s closing price of $3.20. Gas traded Wednesday back at $3.20, up 2.1%.