Highest U.S. oil production in 43 years

Highest U.S. oil production in 43 years

Details here.

"Jan 7 (Reuters) - The U.S. Energy Information Administration said on Tuesday oil production in the United States will reach a 43-year high in 2015 as output grows from shale fields."

Since actual U.S. oil consumption is declining, I guess the excess will be sold on world markets. It seems the certainty of those who we're claiming we'd reached "peak oil" was misplaced.

Haeze | 9 januar 2014

I thought "Peak Oil" as a term was referring to a point where any further extraction of oil will only increase in cost from that point into the future (ie. the price will never go down again because extracting oil is getting more expensive as time goes on)

Dramsey | 9 januar 2014

I hadn't heard that definition before, but even that one is obviously wrong.

Haeze | 9 januar 2014

Well, honestly, the world will never run out of oil. It will simply get more and more prohibitively expensive, to the point that we find alternatives and stop using it.

The fact that most US oil production is coming from tar sands means we are already using the MUCH more expensive methods, since drilling is so much cheaper.

I don't think we are as far from peak oil as you assume, even with news about the US opening their strategic reserves, and allowing more production.

LeonardD | 9 januar 2014

Whether or not the price of oil will go up, down or remain unchanged is not as important as reducing pollution. We will continue to use oil for trucks, sea faring vessels, jet fuel etc. for a long time to come. I personally like the idea of not having to wait in a line to get gas. Or spending the time driving to a gas station to fill up. Even if it only takes a minute (usually more like 3 - 5 mins) There is still the trip to and from the gas station (another 10 minutes) Oil resources will eventually be depleted and there will eventually be a shortage, so why not use it wisely.

DTsea | 9 januar 2014

Peak oil means, literally, the point where global supply peaks and begins to decline. As Haeze says, in a free market we wont run out- price increases will suppress demand and to some extent increase supply.

I'm no zealot, but if the fears about fracking (source of the current Dakota/Texas oil boom) bear out, then the externalities (environmental damage costs not paid at time of extraction) could be BIG.

Nonetheless it is finite, and using it slower, leaving some for later, is a good thing!

DTsea | 9 januar 2014

The economic point about peak oil is demand is rising. If supply fell, persistently, due to the inelastic (not very price sensitive) demand for oil, prices could rise drastically and quickly.

For example, the percentage of cost to operate an airliner due to fuel has DOUBLED in only the last ten years, despite the introduction of more efficient airplanes, as the price of jet fuel has climbed from under a dollar a gallon to nearly $3 per gallon.

Whether we have reached peak oil is an academic point. The substantive point is that we need to conserve oil for the purposes where there are no or limited substitutes- airplanes, ships, chemicals- until we devise a means of making fuel synthetically from other fuel sources- which is a 40-60 year horizon.

jordanrichard | 9 januar 2014

Here it is our oil production is at it's highest, yet as soon as someone gets an itch over in the Middle East, the price we pay for gas goes up immediately. I would like the oil companies to explain why gas costs as much as it does. In the mid 70's gas was something like 45 cents a gallon. Adjusted for inflation, that equates to $1.84 today. Yet, the price of gas is well over $3.

just an allusion | 9 januar 2014

What annoys and, particularly, infuriates me the most is recognition of all of the soldiers and civilians, and their associated families alike, that could have been saved had the oil companies exploited this technology "43 years ago".

Just think, 43 years of needlessly lost mothers, fathers, brothers, sisters, wives, husbands, cousins, friends and families, all just to go chasing after what we already had here.

Sure, it made sense to exploit the more so easily (if you classify WAR as 'easy') obtainable sources, but was it worth the humanitarian sacrifice of both our loved ones lives and our own conscience?

And now here we are, desperately exploiting that which we already had just to cling a little longer to a dying technology that has the reciprocal effect of killing us from its' mere use in the form of Carbon/Nitrogen Dioxide/Monoxide, Lead (and others) poisoning.

Such a shame the sham of oil is.

Dramsey | 9 januar 2014

@Haeze: I think you're confused. As far as I know, the U.S. has no tar sands. You're thinking of Canada.

Brian H | 10 januar 2014

Oil shale, not too different.

DTsea | 10 januar 2014

Our oil boom is from fracking, not tar sands or shale oil.... Thats why we have a surplus of light sweet crude, not bunker oil. We still import around half our oil.... Just as we were 43 years ago... So we are still exposed to global pricing.

And fracking etc costs more than the older simpler wells.

Plus its free enterprise. Why should they sell a finite resource at cost?

Dramsey | 10 januar 2014

Brian, shale oil isn't fracking; and both are really, really different from tar sands, as is the extraction process for each.

DTsea | 11 januar 2014

@Dramsey has it right. Fracking (hydraulic fracturing) is process of injecting high pressure water into an oil field which has stopped producing to crack the rock and allow oil and gas to flow to the well shaft.

Oil shale is mined, ground, and processed. More like coal mining than oil drilling. It's a different grade of oil, too, I believe.

PapaSmurf | 18 januar 2014

They are all unconventional sources of oil. Tar sands, shale oil, shale natural gas, ultra-deep ocean oil, etc. They all require typically $80 per barrel or higher to be profitable.

We likely hit Peak Oil around 2005-2008 for conventional crude oil. We are likely in the plateau phase currently and could see a decline. Many people argue that we have already begun the decline for conventional oil. The gap is being filled with unconventional oil.

The question is how long these unconventional sources of oil can be exploited at a price that does not crush the economy. Can we expand Tar Sand / North Dakota tight shale formations / Ultra deep Gulf of Mexico oil? How much and for how long? At what price?

The new topic is whether we have also hit Peak Oil Demand. That is the concept that overall we are driving less and therefore we are also on a gradual decline in demand for oil. A few years ago, for the first time in history our annual number of miles driven declined for two years in a row for the USA.

I would add in a new quirk. Electric vehicles are displacing gasoline and diesel. The number of Nissan Leaf and Tesla cars is really taking off on the west coast. I see them everywhere. Within a few years this should be showing up as a measurable displacement of gasoline consumption.

The extremist environmentalists hate EVs also because they are still cars. They will argue that EVs don't solve anything. That seems more political and aimed at hating suburbs and sprawl. They hate the idea that EVs might mean that suburban living can continue.

It all gets sort of twisted as to whether EVs are a real solution for Peak Oil. I think they are. But oil is used in a lot more than just gasoline and diesel. It is the foundation for plastics, fertilizer, medicine and so many other items that are part of our lives.

Oilfield Roughneck | 19 januar 2014

For those really interested in what is actually going on with this "shale bubble" search on Arthur Berman (geologist).

evpro | 2 februar 2014

Problem with fracked oil and gas is that it is expensive to produce and each well has a rapid decline rate. It also uses lots of water, produces toxic wastes and leaves some former farmground littered with roads, concrete pads, decaying equipment and possibly polluted aquifers.

There is also the problem of EROI. When oil was first drilled it came out of the ground under pressure from shallow wells with an EROI of 2-300 to 1. Now using deep water wells and tar sands it is down to between 12 and 20 to 1. Because of the cost of capital, steel and labor it is thought that anything under 10 to 1 starts to be a break even point and no longer will support an industrial civilization.

PapaSmurf | 3 februar 2014


EROEI is very limited in its usefulness. I won't bore you with the details because you can google for yourself if you care. But nobody seriously in the energy business uses it as a measure of anything. It has been massively misunderstood in terms of the entire energy cycle. EROEI at below 10 to 1 is common and is already happening.

just an allusion | 3 februar 2014


Which "extremist environmentalists" would that be? I'd like to have a word with them as they are, clearly, misinformed.

As for oil's constituent connection to a number of products...a reformulation of their constitution would serve to eliminate their dependence on its' contributing component, an inevitable necessity that is already realized given the recent revelation of the detrimental effects of a number of petroleum-based chemicals on the reproductive cycle, fetal development, and genitalia development, for example.

PapaSmurf | 4 februar 2014

@just an allusion

I was on the board of directors for a state group that has a focus on environmental legislation. We actively screen state legislative candidates and then endorse based on those that meet our goals.

I suggested during a candidate review meeting that because one candidate drove an EV (it was a Nissan Leaf) that made a big impression on me that his values are already hugely in our (the environment) direction.

I was jumped on by half the room of militant environmentalists that EVs are a joke and just perpetuate suburban sprawl and distract us from more Light Rail, etc etc....

It sort of became obvious to me that the extreme left does not see EVs as a solution. For many of them, the goal is to make suburbia die, get everyone taking the bus or riding a bicycle or walking. They view EVs as a negative.

Timo | 4 februar 2014

It sort of became obvious to me that the extreme left does not see EVs as a solution. For many of them, the goal is to make suburbia die, get everyone taking the bus or riding a bicycle or walking. They view EVs as a negative.

That's how green party here works as well. Cars are evil, no-one should use one. If you live 30 miles from your job, move closer. Idiots.

angstrom01 | 5 februar 2014

If these two articles aren't sobering, not sure what to tell you:

We're on the plateau, only no one has the guts to call it.

just an allusion | 5 februar 2014


Ah, sounds like you're dealing with some hard core Earther environmentalists who see suburban sprawl as a detrimental, yet unavoidable, factor of inevitable Human proliferation.

Long story short, not everyone is inclined to live atop one another as many are interested in discovering and discerning themselves. As it is, a process of such interpersonal growth often takes the form of defining their own space which many consider a prerequisite to enabling their goal of self awareness/separation from the "pack".

This is not to say that I am oblivious to the environmental impact regarding both the indigenous floral and fauna of this or that rural area, rather, only to acknowledge the inescapable fact that one lifeform need take precedence over another as such is the inherent nature of Life itself...We (Humanity) just happen to be the superior species.

So, given these unavoidable truths, if excursions into this or that pristine ecology are to be made, I'd much rather see them done so with the use of CLEAN vehicle technology as opposed to the dirty ICE type that exacerbates the intrusion manifold, both for the locals and the foreigners.

PapaSmurf | 5 februar 2014

While being a "realistic environmentalist" (self proclaimed title) I try to point out to others in that crowd that the suburbs are already built. It is a sunk cost (I have to explain that term). We are not going to plow those houses down and plant trees.

It is not even remotely realistic to build Light Rail to everyone. So we need to accept that there will be personal transportation in our future. I like to think it will be mostly electric cars and electric scooters.

In that future, I think our grid will be mostly nuclear, hydro, solar, wind, geothermal, etc.

I always try to stress two points when dealing with my environmental groups and legislative priorities:

1) If everyone is poor, nobody will care about environmental policy. So we cannot kill the economy in this process.

2) We cannot say NO to everything. An example of this is objecting to wind turbines because of a few birds or spoiling the view. If we say NO to everything, the serious people at the table (legislators) won't take us seriously. We have to say YES to something realistic.

slipdrive | 6 februar 2014

@Papa. Do you know offhand what the US electric utilities are planning/building for new baseload plants? Has anyone proposed a new nuclear facility in the US ? In Colorado the one small nuke was converted years ago to gas combined cycle, as are several XCEL coal stations now being retrofit with gas turbines. Isn't there a greater abundance of natural gas versus oil longer term in the USA ? thanks

PapaSmurf | 6 februar 2014


I think natural gas and wind are the two largest sources of new capacity that has been brought online in the past 2-3 years. The winner is different in every region based on regional advantages.

There are a few new nuclear power plants under construction in South Carolina and Georgia.

But each of those is only 1,000 MW. The numbers for new capacity natural gas, wind and even solar are larger than nuclear.

There was 930 MW of solar installed in the USA in just the 3rd quarter of 2013.

I am not sure where the new baseload will come from. I think it needs to be nuclear. Hopefully the new nuclear power plants in South Carolina and Georgia will work out economically, then others will have more confidence to invest in that direction. Those are the new designs and should be much safer compared to the older 1970's technology that comprise most nuclear power out there.

Captain_Zap | 6 februar 2014

Why don't we just save our oil for when we really need it and use less expensive and intrusive means of acquiring it?
Is gluttony necessary for economic survival?

I just don't understand this foreign concept of human proliferation being a necessity. We have done away with so many fatal diseases and plagues. Many of our hostile ways have been tempered. As a result, we are not keeping ourselves in check.

There has got to be a better method of maintaining a civilized society than creating larger batches of consumers with every generation. I don't think it will work. There are populations within certain borders that have already discovered this the hard way. There are other civilizations that are now extinct.

What happened to the Zero Population Growth campaign? I listened to it when I was a child. I never had kids. Most of my friends didn't have kids either. In our families, my generation consisted of 6 children. One of those six siblings had two children. Two entire families dwindled down to two kids that are now in college. I think that is great! I hereby designate my personal reproductive allotment, and my brother's too, to Elon Musk. Happy to contribute. ;-)

We have gone as far west as we can go. There is just a few token pieces of untouched wilderness and populations left. If the next 100 to 200 years are like the couple centuries we have a lot to be worried about.

I would much rather hang out here than be forced to consider populating Mars or warehousing humans here. We already have a big head start on the latter.

I like the mountains, valleys, oceans, rivers and their associated environs. We should have plenty of surplus so that we can comfortably harvest natural resources without losing ground. More attention should be paid to rehabilitating and recovering abandoned or destroyed land.

slipdrive | 6 februar 2014

Thanks @Papa. Pretty recent news about nuclear construction. New energy resources will find their own course. Personally, I still think there is opportunity with demand management and conservation. Still the best new source....but it takes a lot of work. Though 8.3 billion in federal loan guarantees for new nuclear plants could pay for a lot of conservation incentives .... That's politics v. reality.

Solarguy01 | 6 februar 2014

I have enjoyed this thread and the referenced articles. Cap Zap, recently re watched "Little Big Man" and as the Wise Old Chief said the white man (just think all people)are crazy. They kill everything and destroy everything and call it progress.
I get my MS Mar 5 and will happily feed it sun electrons.

PapaSmurf | 7 februar 2014


For most countries population in western civilization is at zero growth. Many countries (Japan, Germany, Italy, others in the EU) are less than 2 kids per family.

Frankly, it is the kiss of death for many cultures. Because there are certain other cultures that will never adopt population control measures. They will simply breed until they dominate the planet.

And we will be stupid enough to then import their excess populations and then their cultures will eventually overwhelm ours. Then their breeding will continue in the USA and Europe regardless.

Enjoy it while it lasts. Eventually Europe and the USA will also be overwhelmed with an extra billion people overflowing from the 3rd world.

Brian H | 7 februar 2014

Papa Smurf;
Half right. The demographics of ALL cultures are heading in the same direction. The best forward look is the UN Population Survey Low Fertility spreadsheet (Previously 'Low Band'), the only one that's ever been close to accurate. It currently projects about 8bn in about 2045, declining thereafter.
Here's a ref:

Bubba2000 | 7 februar 2014

The change in demographics is dramatic in Western Europe. The net population is not growing by much. However, the native European population has very low birth rate. Most native women delay having children and then have fertility problems later in life. If they have children it is may be 1, and a few have 2. The birth rate in Germany is something like 1.3... may be only the Vatican has a lower birth rate. However, a closer look shows that a significant portion of the babies born have a foreign origins. Changing demographics no doubt.

These are trends that happen in history. Initially Rome dominated most of their Empire. Then they got the barbarians like Goths, Vandals, Huns, etc moving in. The demographics changed. The last few Roman Emperors were not of Roman origin.

In my lifetime, I have witnessed the fall of the British Empire... it was quick. Even quicker was the fall of the Soviet Empire... it has been expanding for centuries. They imploded in 1 year!

I have wondered how we have survived as a great economic power so far... with all the reckless governance.

PapaSmurf | 8 februar 2014


I question how much larger we can continue with $17 trillion in debt and spending $600 billion per year in defense. I think our end will be some level of debt where the market simply stops buying our bonds.

I don't know if that is at 120% of GDP or 140% of GDP. But we are over 100% of GDP already and it starts looking really ugly around 2020. Our interest on the debt will likely increase by 4X in the coming years. All of the debt will likely cause us to shrink our military footprint across the globe. Example: Do we really need 11 full carrier groups?

Brian H | 9 februar 2014

Entitlements eat way more of the budget than defense. With far poorer results.

Mike T | 10 februar 2014

I'm no analyst and what I write is speculation. I believe that US has been waiting out to ramp up oil production when it is most profitable-makes sense, right? They can see how oil will not be playing as big of a role from the next couple decades on, so these will be the most profitable making years. They also need to create jobs. It's win win. As for alternative power generation, Solar has been gaining lots of ground in the market lately. Keep an eye out for that.