Gulf Oil Less Crucial in Storms as Shale Grows: Chart of the Day
Oil from the Gulf of Mexico as a proportion of U.S. output has fallen to a 14-year low as the shale boom shakes up traditional production patterns, reducing the impact of hurricanes on national supplies.
The CHART OF THE DAY shows that the Gulf will account for 21 percent of domestic output this year, the lowest level since 1998, based on Energy Department data. The Gulf represented 29 percent of production in 2009, the most since at least 1993.
Growth in output from shale-rock formations in the U.S., including the Bakken in North Dakota, has bolstered inland supplies. North Dakota pumped 609,000 barrels of oil in April, up 74 percent from a year earlier, according to department data.
“The Gulf is becoming less important, and it reduces the impact of storms,” said Kyle Cooper, director of commodities research at IAF Advisors in Houston. “Onshore production has been rising while the Gulf of Mexico output has been falling, and that really amplifies the percentage change.”
Oil prices jumped 14 percent in August 2005 as Hurricane Katrina shut platforms in the Gulf of Mexico. Output from federal waters in the Gulf will average 1.32 million barrels a day this year, down 15 percent from 1.56 million in 2009, the Energy Department said in its July 10 Short-Term Energy Outlook.
The U.S. will produce 6.31 million barrels of oil a day this year, the highest level since 1997, according to department estimates. Output in the lower 48 states, excluding the Gulf, will average 4.45 million, up 41 percent from 2009.
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