US crude production currently at 9.5 million barrels a day and expected to add 800,000 to 1 million b.p.d annually. Over the past four weeks, exports averaged 1.7 million b.p.d, triple from a year earlier.
Analysts believe operators will start to run into bottlenecks if exports rise to 3.5 million to 4 million barrels a day. RBC Capital analysts put the figure lower, around 3.2 million b.p.d. |link|
The Opec monthly report showed that total Opec output increased to 32.75 million barrels per day (mbpd) in September, up by 88,500 bpd compared to July, but was 2.5 per cent lower year-on-year.
The US output is near its pre-hurricane levels of 9.50 mbpd and remains elevated in YoY comparisons. The growth in production. The US oil rig count increased by one last week but fell for a third month in a row in October. In October, the oil rig count fell by 13, the biggest decline since May 2016. A slowdown in US production could provide a lift to prices in the medium term.
The spread, or difference, between Brent and WTI continues to support higher U.S. crude oil exports, which could offset some of the OPEC effort.
Saudi Crown Prince Mohammed bin Salman said during the weekend, however, that “high demand for oil has absorbed the increase in shale oil production.”