Citigroup Declares Peak Oil is Dead
“Peak Oil Is Dead.” posted by russet
That was the title of a report published by Citigroup last week.
The basic thesis of the report is that horizontal and hydraulic fracturing of shale formations in the Bakken, Eagle Ford, Utica, and Marcellus, etc., has unleashed an ocean of oil, dry and wet natural gas:
Production from these [shale oil and gas] is rising so fast that total U.S. oil production is surging, even as conventional oil production in Alaska and California is continuing their structural decline...
The rise is shale oil production is already materially impacting the oil markets as rising production out of the Bakken and Eagle Ford and other plays are key drivers for WTI’s disconnect from Brent and the rest of the global crude complex...
Citigroup is so optimistic, in fact, they believe the U.S. will eventually overtake Saudi Arabia and Russia.
The United States was the largest oil producer in the world, achieving that rank when Russian production collapsed at the start of the Russian Revolution and holding on to it until the 1970s, when U.S. oil production peaked at 11.3 million barrels per day.
Since then, it had been declining consistently to a low of 6.8 million bpd in 2007, counting both oil and natural gas liquids (NGL).
But it was in 2007 that we saw the turning point — with current trends pointing to U.S. supply overtaking Saudi Arabia and Russia...
According to the Citigroup report:
The U.S. alone could add 6.6 million bpd to bring liquids from 9 million bpd at end-2011 to over 15.6 million bpd in 2020-22. In total, North America as a whole could add over 11 million bpd of liquids from over 15 million bpd in 2010 to almost 27 million bpd by 2020-22.
Read that again: 27 million barrels per day.
That’s a pretty bold statement.
But I’ve learned to never underestimate American ingenuity and determination...
And if the United States gets to 27 million bpd, or just close to it, the wealth it’ll create for our nation will be a game-changer.
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