An abundance of light crude oil
U.S. crude production will surge to a 45-year high next year, and that could help lower North American crude prices and reduce opportunities for Canadian imports.
In its annual look at world markets for oil, the U.S. Energy Information Administration raised its estimate of U.S. output to 9.53 million barrels a day, the most since 1970.
This year, U.S. output will be 8.53 million barrels a day, up from 7.45 million in 2013.
American production has been boosted by an abundance of light crude oil which becomes more accessible as the extraction technology improves.
Horizontal drilling and hydraulic fracturing, or fracking, have unlocked supplies in shale formations in Texas, North Dakota and other states. U.S. crude production jumped to 8.6 million barrels a day in August, the most since July 1986.
The increased production and a relatively moderate rise in demand has resulted in reduced need for imported crude in the U.S.
“Rising monthly crude oil production, which will approach 10 million barrels a day in late 2015, will help cut U.S. fuel imports to just 21 per cent of domestic demand, the lowest since 1968,” EIA administrator Adam Sieminski said.
In 2014, an abundance of oil has helped oil prices weather disruptions of supply in Syria, south Sudan and Libya.
