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American Petroleum Institute highlights energy net-export accomplishment in quarterly update

A rig drills a well in late 2018 in south Oklahoma City. Production of oil and natural gas from U.S. wells in November set another record as production costs continue to fall. [OKLAHOMAN ARCHIVES]
A rig drills a well in late 2018 in south Oklahoma City. Production of oil and natural gas from U.S. wells in November set another record as production costs continue to fall. [OKLAHOMAN ARCHIVES]

Technological advances that led to increased recovery rates for oil and natural gas helped the nation achieve what had been unthinkable just 20 years ago.

In September, the U.S. became a net exporter of total energy, something it hadn’t been in nearly 60 years. Meanwhile, production has remained strong as midstream service providers have added pipeline capacities to move product out of key producing basins.

In November, the U.S. set an average production record of 12.8 million barrels of crude oil per day.

“Never before has a major energy-consuming nation also become a top global exporter of total energy — usually, it’s the other way around,” Dean Foreman, chief economist at the American Petroleum Institute, said earlier this week.

“The fact that U.S. production has been able to simultaneously satisfy strong domestic demand and supply continued international demand for U.S. exports, while maintaining relatively low and stable prices, is remarkable.”

Foreman made those comments and others while reviewing the institute’s fourth-quarter 2019 industry outlook and statistical production data for oil and natural gas in November.

The institute, like the U.S. Energy Information Administration, is projecting that the nation will see continued production growth of both oil and natural gas during the coming year.

Its outlook notes that natural gas demand for electricity generation increased 5.6% through November in 2019, compared to the same period the previous year.

It also notes that average daily demand for U.S. petroleum products in November was 21 million barrels, the highest on record for that month, and that U.S. crude oil and petroleum exports remained steady above 8 million barrels per day.

Between January and August 2019, the outlook shows Oklahoma was the fourth-biggest producer of crude oil in the U.S., behind New Mexico, North Dakota and Texas, and that year-over-year production during that period for the state was up by about 8%.

As for natural gas, Oklahoma was the nation’s third-largest producer, behind Pennsylvania and Texas.

Foreman said in part what makes the U.S.’s energy independence accomplishment even more noteworthy is the fact it achieved that status despite the absence of a booming global economy.

“From an economic perspective, 2019 has been challenging for many countries around the world,” he said, adding that economists generally expect a more stable situation during the next couple of years even while the U.S. economy is expected to slow, somewhat.

“From a global oil market perspective, we saw global consumption demands increase … up more than 1 million barrels per day in 2019.”

Foreman said the U.S., as a nation, added more. In fact, he said the U.S. has added the most in new supplies of oil and natural gas each of the past two years in the world’s history.

“This is a tremendous milestone, but not the only one,” he said. “But we can’t rest on our laurels.”

Foreman said it is critical that the U.S. government approve its pending trade deal with Canada and Mexico, and that additional export capacity needs to further expand to meet increased demands from producers and consumers.

Improved drilling productivity trends are pushing break-even prices for oil and natural gas lower, he observed.

“This is a big green light in terms of continued U.S. production growth,” Foreman said.

Related Photos
<strong>A worker checks tank levels at a U.S. production facility. The nation became a net exporter of energy earlier this year. [PROVIDED]</strong>

A worker checks tank levels at a U.S. production facility. The nation became a net exporter of energy earlier this year. [PROVIDED]

<figure><img src="//cdn2.newsok.biz/cache/r960-f370564a5eeec5e43ee03f7f86cefd08.jpg" alt="Photo - A worker checks tank levels at a U.S. production facility. The nation became a net exporter of energy earlier this year. [PROVIDED] " title=" A worker checks tank levels at a U.S. production facility. The nation became a net exporter of energy earlier this year. [PROVIDED] "><figcaption> A worker checks tank levels at a U.S. production facility. The nation became a net exporter of energy earlier this year. [PROVIDED] </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-08fd352873bb4af5ddc919678a57bc1a.jpg" alt="Photo - The Golden Pass Terminal in Sabine Pass, Texas, is shown. Golden Pass Products is building a $10 billion export terminal for LNG at the facility, which originally was built to import the product. The U.S. will have exported nearly 2.5 quadrillion British thermal units of the fuel in 2019, the U.S. Energy Information Administration has estimated. [PROVIDED] " title=" The Golden Pass Terminal in Sabine Pass, Texas, is shown. Golden Pass Products is building a $10 billion export terminal for LNG at the facility, which originally was built to import the product. The U.S. will have exported nearly 2.5 quadrillion British thermal units of the fuel in 2019, the U.S. Energy Information Administration has estimated. [PROVIDED] "><figcaption> The Golden Pass Terminal in Sabine Pass, Texas, is shown. Golden Pass Products is building a $10 billion export terminal for LNG at the facility, which originally was built to import the product. The U.S. will have exported nearly 2.5 quadrillion British thermal units of the fuel in 2019, the U.S. Energy Information Administration has estimated. [PROVIDED] </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-90728afe469642b0dc30c5eb4f46d980.jpg" alt="Photo - A rig drills a well in late 2018 in south Oklahoma City. Production of oil and natural gas from U.S. wells in November set another record as production costs continue to fall. [OKLAHOMAN ARCHIVES] " title=" A rig drills a well in late 2018 in south Oklahoma City. Production of oil and natural gas from U.S. wells in November set another record as production costs continue to fall. [OKLAHOMAN ARCHIVES] "><figcaption> A rig drills a well in late 2018 in south Oklahoma City. Production of oil and natural gas from U.S. wells in November set another record as production costs continue to fall. [OKLAHOMAN ARCHIVES] </figcaption></figure>
Jack Money

Jack Money has worked for The Oklahoman for more than 20 years. During that time, he has worked for the paper’s city, state, metro and business news desks, including serving for a while as an assistant city editor. Money has won state and regional... Read more ›

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