The United States has briefly become the world’s No. 1 oil exporter as record shale production finds its way to global customers, and there are possibilities for going even further.
The International Energy Agency said in a report citing the total export figures that the rise in production of oil shale helped America ship nearly 9 million barrels per day of crude oil and oil products in June, exceeding Saudi Arabia. There is scope to send more supplies abroad as companies add infrastructure to transport booming production from fields in Texas and New Mexico to the coast.
The increases in the US supply are undermining the efforts of the Organization of Petroleum Exporting Countries (OPEC) and its allies, whose production cuts are in their third year in an attempt to drain inventories. US production inflation, as well as growing concerns about global demand fueled by the prolonged US-China trade war, brought Brent benchmark down nearly 20% from its April high.
The expansion in US exports in June was helped by a rise in crude shipments to more than 3 million barrels per day, the agency said. At the time, Saudi Arabia was cutting exports as part of the OPEC + agreement, while Russian flows were constrained by the Druzhba pipeline crisis.
The agency said the Saudis regained the place of exporters in July and August, affecting US production and that the trade dispute ” made it more difficult for shale shipments to find markets,”
The fight for the No 1 spot could continue to be fairly tight in the coming months. As Saudi Arabia continues to limit production, the International Energy Agency said US crude oil exports could rise another 33% from June levels to 4 million barrels per day as new export infrastructure is built in the fourth quarter of this year.