U.S. crude oil production continues to break records

According to the U.S. Energy Information Administration (EIA), the United States has produced more crude oil than any other nation for the sixth consecutive year. In 2023, the production average of 12.9 million barrels per day exceeded the previous global record of 12.3 million barrels per day, set in 2019.

According to the EIA, the United States set a monthly production record of more than 13.3 million barrels per day in December 2023. The 2023 record set by the United States is unlikely to be broken by another country in the short term because no other country has reached a production capacity of 13 million barrels per day. Saudi Aramco, a state-owned company in Saudi Arabia, recently scrapped plans to increase production capacity to 13 million barrels per day by 2027.

The United States, Russia and Saudi Arabia accounted for 40% of global oil production in 2023. The three countries have produced more oil than any other since 1971. By comparison, the next largest three producers – Canada, Iraq and China – combined produced 13.1 million barrels per day in 2023.

After reaching 9.6 million barrels per day in 1970, U.S. crude oil production flattened and declined for decades to a low of 5 million barrels per day in 2008. In 2009, production started rising again as producers applied hydraulic fracturing and horizontal drilling techniques. Since then, the only years without production growth were 2020 and 2021 when demand and prices declined because of the economic effects of the COVID-19 pandemic.

In recent years, production in the Permian Basin in western Texas and eastern New Mexico has been driving the increases in total crude oil and natural gas production in the United States. In 2017, Russia produced the most crude oil, but since then, production growth has lagged behind the United States. In 2019, production in Russia reached a peak of 10.8 million barrels per day, which trailed the United States by 1.4 million barrels per day that year.

In 2022, Saudi Arabia’s production peaked at 10.6 million barrels per day, 1.3 million barrels per day less than the United States’ production that year. Saudi Aramco’s production capacity is 12 million barrels per day. Saudi Arabia has about 300,000 barrels per day of additional capacity in the Neutral Zone area shared with Kuwait.

Russia and Saudi Arabia are part of OPEC+, which has announced production cuts over the past two years. According to the EIA, production in Russia fell by 200,000 barrels per day in 2023 because of sanctions and voluntary cuts by companies in response to the Russian invasion of Ukraine. Production in Saudi Arabia fell last year by about 900,000 barrels per day because of the OPEC­+ cuts and to offset slower demand growth.

According to AAA, the price of crude oil, the main ingredient in gasoline, has risen by $10 to about $80 per barrel recently, compared to a few months ago.

“Higher crude oil prices and increased demand contributed to the Arkansas statewide average gas price surpassing the $3 per gallon mark this week for the first time since November 2023,” said AAA spokesman Nick Chabarria. “The current oil and gas environment, along with warmer weather and longer days, is ripe for further pump price increases as spring quickly approaches.”

Arkansas motorists are paying the fifth-lowest average price in the United States. AAA data shows the average price in Arkansas is $3.06 per gallon, 1 cent less than last year but 27 cents higher than last month. The U.S. average is $3.39 per gallon, down 7 cents from last year but up 20 cents from last month.