The Future of American Oil Production

Oil is likely to remain the world’s number one fuel source, at least until 2040. Unconventional fuel sources will lead the way as advances in technology continue enabling the production of oil from previously unrecoverable formations, while conventional crude production, though less expensive than shale oil and other unconventionals, will slow during the same period.i, ii

The EIA expects US crude production to peak in 2019 at 10,472,000 bpd or 824,000 barrels per day higher than the expected last year. Revising its projections for 2015 and beyond, the organization now expects the US to be producing 9,329,000 bpd in 2040 or 1,812 higher than had been projected for 2040 last year.iii

Since 2008, when domestic crude production averaging 5.0 million barrels per day was the lowest since 1946, production has been on the upswing through advanced techniques combining fracking with horizontal drilling.iv

As a result, American oil production has increased dramatically in the last two decades. In September of 2013, the EIA reported that domestic oil production was up to 7.621 million barrels per day – the highest domestic production since 1989.v In 2014, U.S. crude oil production (including lease condensate) increased during by 1.2 million barrels per day (bbl/d) to 8.7 million bbl/d, the largest volume increase since recordkeeping

Leading the way are states like Texas, North Dakota, Alaska, California, New Mexico, Oklahoma and Utah, which are among the top 10 oil producing states in the country.vii And because U.S. oil production continued at a record rate, 2014 was the year that the United States replaced Saudi Arabia as the world’s leading oil producer.viii

Utah's change in O&G production mapped alongside the United States' change in O&G production.
Source: U.S. Energy Information Administration, Petroleum Supply Monthly

The U.S. Energy Information Administration (EIA) predicts in its 2015 forecast that crude oil production will peak at 10.6 million barrels per day in 2020, moderating to 9.4 million barrels per day thereafter, higher than the agency expected in 2014.ix Assuming investment in petroleum and gas production remains strong, net US petroleum imports will account for only 14 percent of domestic liquid fuels consumption in 2020, down from 26 percent in 2014. Strong growth in domestic production of crude oil is expected from tight formations through 2020, limited growth in domestic demand after 2020.x


Petroleum Products: From Fuel to Household Goods

Most petroleum products are used for energy: One barrel of refined crude produces about 19 gallons of gasoline, 10 gallons of diesel, and four gallons of jet fuel.xi

But petroleum is also used to produce a wide range of other everyday products, including:xii

  • Fuel for heating homes
  • Ammonia
  • Motor oil
  • CDs and DVDs
  • Crayons and ink
  • Medical products, such as heart valves and eyeglasses
  • Beauty products, such as cosmetics and lotions
  • Rubbers and detergents


Beyond the Bakken

When most people think of the U.S. oil boom, they think of North Dakota’s Bakken Formation. In 2008, Williston became the center of a modern-day oil boom after advancements in drilling technology made it possible to extract oil from the area’s tightly folded rock formations.xii Since then, North Dakota has become the second largest producer of crude in the United States (Texas remains in the number one spot).xiii The boom has brought jobs to the state, too: North Dakota boasts one of the lowest unemployment rates in the country. xiv

But North Dakota is far from the only state set to benefit from technological advancements like fracking and horizontal drilling. In Pennsylvania and Ohio, oil and gas operations are underway in the Marcellus and Utica formations. Texas is home to the Eagle Ford shale play. In Utah, according to the US Geological Survey, the Uinta Basin is estimated to contain a total of 1.32 trillion barrels of resources in place, making it one of the richest oil shale deposits in the world.xv





Domestic Oil: Quick Facts
  • In September 2013, domestic oil production reached 7.621 BBLs per day – the highest production since 1989.
  • Technological advancements such as fracking and horizontal drilling have made it possible to extract oil from “tight” rock formations.
  • The US could be producing as much a 16.6 million barrels per day in 2040 (EIA High Oil & Gas Resource case), compared with a peak of 10.6 million barrels per day in 2020.
  • Utah is one of the top 10 oil-producing states in the U.S. Other top producers include Texas, Alaska, and North Dakota.