U.S. oil production has peaked…at least for now.
“Even if production growth comes to a halt, it comes in at higher level than analysts expected earlier this year,” said Jim Burkhard, head of global market research for IHS.
Despite the slowdown in U.S. oil patch, producers are expected to pump more oil in 2015 than in 45 years. Expected average production is 9.5 million barrels per this year. This equals about 40,000 more barrels per day than the EIA projected last month.
The domestic benchmark is expected to average $55 per barrel the rest of the year, which still allows the Bakken, Eagle Ford, Niobara, and Permian Basins to remain economically viable to support development and drilling. The rigs and wells are becoming more efficient and productive, and the cost to drill and complete continue to fall allowing onshore drilling to grow again in 2016.
The EIA expects oil prices at $62 per barrel next year.
Sources: “EIA Confirms: Oil Production Peaked,” By Nick Cunningham, Oil Price.com, July 12, 2015; “U.S. oil output still barreling toward 45-year record,” by Rhiannon Meyers, Houston Chronicle, July 7, 2015;