U.S. crude production climbed to the highest level in more than 28 years last week as the shale boom moved the country closer to energy independence.
Output rose 248,000 barrels a day to 8.838 million, the most since March 1986, according to Energy Information Administration data. The combination of horizontal drilling and hydraulic fracturing, or fracking, has unlocked supplies from shale formations in the central U.S., including the Bakken in North Dakota and the Eagle Ford in Texas.
“The shale boom hasn’t run its course yet,” Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts, said by phone. “The U.S. is in a good and improving position as far as oil supply is concerned.”
Production gains helped bolster U.S. inventories by 3.67 million barrels to 362.3 million barrels in the week ended Sept. 12, according to the EIA report. It was the biggest one-week increase since April, according to the agency.
U.S. output will climb 14 percent to an average of 8.53 million barrels a day this year, the EIA said in its monthly Short-Term Energy Outlook on Sept. 9. Production will rise to 9.53 million barrels a day in 2015, the most since 1970, according to the agency.
Three factors drove the big gain in this week’s production figure, Robert Merriam, an EIA analyst who compiles the Weekly Petroleum Status Report, said in an e-mail. This was the first full week that reflected the most recent Short-Term Energy Outlook, Alaskan production returned after a pipeline shutdown and the EIA revised Gulf of Mexico production higher because the models accounted for hurricanes that haven’t occurred this year.
Production gains helped bolster U.S. inventories by 3.67 million barrels to 362.3 million barrels in the week ended Sept. 12, according to the EIA report. It was the biggest increase since April, according to the agency.
West Texas Intermediate crude for October delivery slipped 46 cents, or 0.5 percent, to settle today at $94.42 a barrel on the New York Mercantile Exchange.