Drillers Are Optimistic As U.S. Oil Production Booms
ROBERT SIEGEL, HOST:
Oil production in this country is surging. Part of the reason is that prices for crude oil are nearly double what they were two years ago. Gasoline prices are up, too. The national average for regular gas is about 15 cents more per gallon than last year. That has drillers feeling optimistic, so they're sending more rigs back out into oil fields. NPR's Jeff Brady reports.
JEFF BRADY, BYLINE: All that optimism could lead to a new crude oil production record in the U.S. The key number here is 10 million.
TOM KLOZA: Well, we haven't seen 10 million barrels a day of U.S. production since November of 1970.
BRADY: Tom Kloza with Oil Price Information Service says that record stood for 47 years, and just about no one thought it would be broken until controversial technologies like hydraulic fracturing brought new life to old oil fields by tapping previously unreachable reserves. Fracking can be expensive. And while prices were low, drilling slowed. Now that they're back up, crews are at work again.
KLOZA: And it has nothing to do with who is in office.
BRADY: Prices generally determine when oil companies drill, not presidents. A new production record will almost certainly be set during President Trump's term. Kloza predicts it'll happen this spring. Others believe the U.S. might already produce 10 million barrels a day.
PER MAGNUS NYSVEEN: We think that during December, that mark was actually reached.
BRADY: Per Magnus Nysveen is an oil market analyst with the Norwegian firm Rystad Energy. This disagreement will be settled when official federal production numbers are out at the end of February. After that, Nysveen predicts U.S. crude production will surpass Saudi Arabia and Russia.
NYSVEEN: So if we are at 10 million barrels 1st of January, I think we can be at 11 million barrels by the end of 2018.
BRADY: As production increases, U.S. cars are more fuel-efficient, and overall demand is flat. So it's unlikely there will be any dramatic gas price increases in the near future. Jeff Brady, NPR News.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.