WASHINGTON, D.C. (Bloomberg) — 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 bpd to 8.838 million, the most since March 1986, according to Energy Information Administration data. The combination of horizontal drilling and hydraulic fracturing has unlocked supplies from shale formations in the central U.S., including the Bakken in North Dakota and the Eagle Ford in Texas.
â€œThe shale boom hasnâ€™t run its course yet,â€ Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts, said by phone. â€œThe U.S. is in a good and improving position as far as oil supply is concerned.â€
Production gains helped bolster U.S. inventories by 3.67 MMbbl to 362.3 MMbbl 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% to an average of 8.53 MMbpd this year, the EIA said in its monthly Short-Term Energy Outlook on Sept. 9. Production will rise to 9.53 MMbpd in 2015, the most since 1970, according to the agency.
Three factors drove the big gain in this weekâ€™s production figure, Robert Merriam, an EIA analyst who compiles the Weekly Petroleum Status Report, said in an email. 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 havenâ€™t occurred this year.
West Texas Intermediate crude for November delivery slipped 90 cents, or 1%, to $93.98/bbl at 12:21 p.m. on the New York Mercantile Exchange