April 17, 2019
About 10 years ago, oil industry discussions centered around “peak oil,” a potential decrease in oil production, and concerns about running out of energy. Fast-forwarding a decade, the talk is now of doubling of production levels. According to economist Ray Perryman, total Texas oil production increased about 500% since 2010, and production levels are forecast to double yet again within the next few years.
One outcome of the production gains is the reduction in the need for imports; Perryman pointed out that imports have decreased from their 2006 peak level. Another outcome is a surplus of U.S. crude, with all of that petroleum making its way to foreign markets. “Export infrastructure is about maxed out,” Perryman wrote, “and new capacity is desperately needed.” He added that port expansion and the efficient use of resources will help move the product from the U.S. to foreign markets.
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