U.S. Surpasses Historic Oil Production, Forecasts Strong Global Supply

By Editor


The United States is poised to enter the new year with an unprecedented achievement in the oil industry, as S&P Global Commodity Insights’ latest oil markets outlook forecasts the nation producing more oil than any other country in history. This robust growth in production is expected to outstrip the escalating global demand, leading to a surplus in the oil market.

According to the report, U.S. total liquids production for Q4 2023 has reached 13.3 million barrels per day (b/d), a figure comprising 21.4 million b/d of crude and condensate, along with a mix of natural gas liquids and biofuels. These figures mark global records in oil production. Moreover, Brazil and Canada are set to follow suit, both gearing up to achieve their highest production rates in history. Anticipations for 2024 suggest that all three nations will continue setting new national highs.

Jim Burkhard, Vice President and Head of Research for Oil Markets, Energy, and Mobility at S&P Global Commodity Insights, highlighted the extraordinary shift in the U.S. oil landscape.

The United States’ current oil production surpasses that of any country in history. The volume of oil, including crude oil, refined products, and natural gas liquids, being exported is nearly equivalent to the total production of Saudi Arabia or Russia. This remarkable turnaround from 2008, a period when U.S. production hit a 62-year low with zero exports, signifies a monumental transformation.

Despite the projected record-high global crude oil demand in 2024, the report assures that the burgeoning supply will effortlessly meet and even exceed this growing demand. Projections indicate that non-OPEC+ liquids supply will surge by 2.7 million b/d in 2024, significantly outpacing the total demand growth of 1.6 million b/d.

The forecasted surplus in oil supply, coupled with OPEC+ supply constraints, positions the 2024 oil price range between $75 and $100 per barrel for Dated Brent, as per the analysis by S&P Global Commodity Insights.

“Oil markets are entering 2024 with a new equilibrium. OPEC+ supply management acts as a buffer to prevent prices from dropping significantly, while simultaneously fostering enough price strength to support oil production growth outside of OPEC+, preventing an excessive surge in prices,” Jim Burkhard said.

The report cautions that the same fundamental forces that prompted shifts in the past persist today. “If prices persist at levels conducive to robust supply increases outside of OPEC+, pressure on OPEC+ to implement further production cuts will mount. While actions are often taken to stabilize prices, historical trends reveal instances where supply restrictions led to increased burdens and lost market shares,” Jim Burkhard said.

The S&P Global Commodity Insights report also provided specific production figures for Brazil and Canada in 2023: Brazil reported 3.388 million b/d of crude and condensate, totaling 4.195 million b/d of total liquids, while Canada recorded 4.844 million b/d of crude and condensate, contributing to 5.674 million b/d of total liquids.

As the oil market readies itself for 2024, the intricate interplay between supply, demand, and geopolitical dynamics continues to shape the volatile landscape, prompting vigilance and adaptability among industry players worldwide.

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