The business of America is oil, and business is booming. Government data shows that U.S. crude oil production for 2013 reached its highest levels since 1989, averaging 7.5 million billion barrels per day.
The Energy Information Administration reports that crude oil production averaged 967,000 barrels per day, or 15 percent, higher in 2013 than in 2012, the highest production level in 24 years.
This is the largest annual increase in domestic oil production since 1940 which supported high refinery utilization rates and reduced U.S. oil imports to the lowest levels since 1996. Crude imports are now 30 percent below their June 2005 peak levels.
What’s even more startling is that oil production from hydraulic fracturing, or fracking, in North Dakota and Texas made up 83 percent of the U.S. production growth. EIA notes that production in the “Eagle Ford formation in South Texas reached an estimated 1.22 million bbl/d in December 2013. Production from the Bakken formation in North Dakota and Montana averaged 0.9 million bbl/d in 2013 and reached 1 million bbl/d in November 2013.”
This came as seven states and the Gulf of Mexico saw oil production fall from 2012 levels. Alaska and the gulf accounted for most of the decline in these areas, each seeing oil production fall by two percent.
The U.S. has been projected to soon overtake Saudi Arabia as the world’s largest oil producer. America has already beat out Russia as the world’s largest natural gas producer and is known as the “Saudi Arabia of coal” for its vast deposits of the fuel source. Energy experts and federal lawmakers argue that the U.S. is on the verge of energy dominance.
“I think it is realistic that the U.S. could be energy self-sufficient by the end of this decade,” Exxon Mobil CEO Rex Tillerson told CNBC. “We’re already the world’s largest natural gas producer (and) last year crude oil production surpassed levels not seen since the 1980s.”
The recent crisis in Ukraine have only bolstered U.S. energy proponents, sparking calls for increased energy exports to the rest of the world to loosen the grip of Russia and the oil cartel OPEC.
“I have called for lifting the de facto prohibition on crude oil exports as a preemptive measure. We need to lift it to prevent future losses of production and jobs when our trade restrictions inevitably collide with the surge in light tight oil and condensate production,” said Alaska Republican Sen. Lisa Murkowski. “My point is that we must increase the value of energy as an American strategic asset for global security and price stability.”
The U.S. was able to supply 49 percent of its oil needs in 2013, up from 43 percent in 2012 and EIA expects crude oil production to rise 8.4 million billion barrels per day in 2014 and 9.2 million billion barrels per day by 2015.
While overall U.S. oil production has risen, production on federal lands has been falling in recent years. The Congressional Research Service reports that oil production on federal lands fell from 1,731,500 barrels per day in 2009 to 1,627,400 barrels per day in 2012. The total share of crude oil produced on federal lands fell to 26 percent in 2012 from 33 percent in 2009.
“All of the increased production from FY2007 to FY2012 took place on non-federal lands, causing the federal share of total U.S. crude oil production to fall by about seven percentage points,” according to CRS.