Crude oil is extending a rapid rally to the joy of the US shale oil producers. As global benchmark oil prices are steadily advancing, the US drilling companies ramp up oil production to record rates. Experts warn that shale companies are eager to pump oil at record rates throughout 2018. According to estimates, oil output could expand by 6.5% next year compared to 2017.
In case forecasts come true, the US energy companies will produce whopping 9.9 million barrels per day. Such rates were recorded once in 1970. No wonder the bulk of oil production comes from shale oil producers in Texas and oil platforms in the Gulf of Mexico. With the current prices on the global oil market, the US producers again find it profitable to extract shale oil. Besides, the advance in the shale technology makes oil production cheaper and simpler. The Permian basin alone, the core of the US shale industry, is capable of providing one third of the total domestic shale output which could be 2.9 million barrels per day. Production rates in the Gulf of Mexico are estimated at 1.9 million per day for 2018, up from 1.7 million barrels in 2017.
Importantly, the shale boom in the US triggered a slump in oil prices back in 2014. In other words, the US producers caused a protracted glut in the global market. The oversupply has been tackled by joint efforts from OPEC and other large oil exporters. At present, a highly probable scenario is that a new wave of the shale boom is likely to deal a blow to oil prices soon.
