Indications have emerged that a U.S oil boom will be achieved in 2017 despite the setbacks it suffered in recent years.
For the last seven months, there was a downturn in U.S oil production. And for the very first time in two years, oil production dropped below the 9-million barrel mark due to excessive supply and extreme pumping from Saudi Arabia, Iran and other OPEC member countries.
The U.S oil boom was dealt a severe blow from OPEC. But according to Goldman Sachs, U.S oil production, which has been declining for several years, will experience a surge in 2017 and beyond.
The United States still owns 264 billion barrels of oil reserves, more than any country across the globe. 8.9 million barrels per day were pumped by the U.S in April 2016, leaving output at a 20-month low and down by 8% from April, 2015. That was the best month for oil production ever recorded by the United States since 1971.
The decision of U.S to pull back from production seems sensible as oil prices dropped from above $100/barrel in 2014 hit $26 recently. However, oil prices recently experienced a surge back to around $50/barrel. This is an encouraging sign.
Goldman further predicted that between October 2016 and December, 2017, an increase in oil supply from 60,000 to 70,000 barrels per day from the Lower 48 U.S states is realistic and achievable. Oil analysts said that the shale increase will concentrate four important oil plays namely: The Eagle Ford and Permian Basin in Texas, North Dakota’s Bakken and the DJ Basin in Colorado. Bright news for oil investors around the country.