Total U.S. hydrocarbon production continued to grow even as prices remained low

The United States remained the largest hydrocarbon producer in the world for the third consecutive year in 2015. Despite low crude oil prices, and a 60% drop in the number of operating oil and natural gas rigs, U.S. petroleum and natural gas hydrocarbon production increased roughly 2.0 MMBOEPD to about 29.0 MMBOEPD, according to information from the EIA.

EIA 2015 Top Three Hydrocarbon Producers

In the United States, crude oil and lease condensate accounted for roughly 60% of the total petroleum hydrocarbon production in 2015. An additional 20% of the U.S. production was natural gas plant liquids. Biofuels and refinery processing gain make up most of the remaining U.S. petroleum and other liquids production volumes.

U.S. petroleum supply increased by 1.0 MMBOPD in 2015, while natural gas production increased by 3.7 Bcf/d. Nearly all the increases in natural gas production came from the eastern United States, reports the EIA.

Breakeven costs for production for natural gas in the eastern United States are the lowest in the country, particularly in the southwest wet Marcellus, according to a report from KLR Group released Monday.

Breakeven by basin for gas

Data: KLR, Map: EIA, Compiled by EnerCom

U.S. production expected to slow as Russia and Saudi Arabia continue pumping

For the United States and Russia, total hydrocarbon production, in energy content terms, is almost evenly split between petroleum and natural gas. Saudi Arabia’s production, on the other hand, heavily favors petroleum.

Russia’s total hydrocarbon production increased by just 0.1 quadrillion Btu in 2015, according to the EIA. Petroleum production continued to increase year-over-year, but natural gas production negated some of those gains as a mild winter hurt demand, and poor economics made increasing production commercially unviable.

Hydrocarbon production in OPEC’s largest producer increased by 3% in 2015 as the kingdom shrugged off its traditional role of balancing global markets. Saudi Arabia’s total production still amounted to just half that of the United States, even as the country produced at full steam.

U.S. petroleum and other liquid fuels production is expected to decline from 15.0 MMBOPD in 2015 to about 14.5 MMBOPD in both 2016 and 2017, the EIA said in its May Short-Term Energy Outlook. In contrast, STEO forecasts Russian liquid fuels production to remain at about 11.0 MMBOPD through 2017, and, while the EIA does not publish forecasts for individual OPEC members, there is no indication that Saudi Arabia plans to reduce production in the near future.

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