North American oil production soared amid low oil prices from OPEC and Russia. Traders acknowledged that overall market conditions remained constant thanks to recent production cuts and all-around healthy demand-growth.
Brent crude futures were reported to be above $70 per barrel, while the U.S. West Texas Intermediate (WTI) crude futures were at $66.19 per barrel. According to analysts familiar with the situation, North American oil output put pressure on the worldwide market. The results became apparent after it was reported that U.S. crude production expanded more than 17 percent since the middle of 2016 to 9.88 million barrels per day in mid-January.
More so, the output is believed to remain on the rise with a 10 million bpd break coming soon. It was reported that U.S. energy companies opened 12 new oil rigs last week, bringing the number of oil operations to 759, according to the energy services firm, General Electric Baker Hughes.
U.S. oil output now considered to be in the same league with OPEC juggernaut Saudi Arabia. Russia still remains at the top of the pack with an estimated 10.98 bpd reported in 2017.
U.S. neighbor, Canada, shows signs of picking up on oil production, averaging at 335 thousand bpd. Canadian crude production currently totals at 4.2 million bpd.
According to several sources, North American output has been one of a number of factors that are holding back oil markets.
Oil prices have risen by 60 percent since mid-2017 a symptom of hefty cash investments into crude futures from investors. More so, it’s believed that oil prices have thrown a wedge into dollar growth.
“Loose fiscal policy in the U.S., a recovery in growth in Europe and an acceleration in EM (emerging market) growth have all combined to push the dollar lower and oil prices higher,” Bank of America Merrill lynch states.
American bank, JP Morgan, announced that it had increased in 2018 oil price forecast by $10 per barrel to $70 per barrel for Brent crude and by $10.70 per barrel for WTI to $65.63.
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