10 charts that illustrate America's energy boom

America became the world’s largest oil producer in 2014.

In a recent note to clients, Joseph Quinlan, chief market strategist, U.S. Trust, Bank of America Private Wealth Management highlighted three ways this became possible:

“It was (1) pro-market policies at the state and local level, combined with (2) revolutionary technologies like horizontal drilling
and hydraulic fracturing, and (3) good old American entrepreneurship/risk-taking that upended the energy patch.”

Quinlan notes that while the boom has established the US as an energy superpower, it has put downward pressure on oil prices.

He highlighted these ten charts that show how America’s energy landscape has transformed over the years.:

1. Oil production is surging even though rig counts are declining. “A great deal of this production has gone into storage, which will put a cap on oil prices over the near term.”

(Percentage change since January 3, 2014)

2. The US has nurtured two “super-giant” oil fields. “A super-giant oil field is one that produces more than 1 million barrels per day, and in the U.S. and around the world.”

(Million barrels per day)

3. US oil production has exploded over the past few years. “In the past two years, U.S. oil production has increased by roughly 2.2 million bpd, a more than one-third increase in production.”

(Thousand barrels per day, 4-week moving average)
4. “The U.S. has been a major driver of incremental global oil output.”

(Change in crude oil production from 2008 to 2013)

5. National gas production has also surged. “According to the EIA, more than 50% of new wells in production in 2011 and 2012 produced both oil and natural gas.”

(Monthly, billion cubic feet)

6. The US is the world’s largest natural gas producer, generating around one-fifth of global production in 2014. “The US alone produced roughly one-fifth more natural gas than the entire Middle East last year, and U.S. production was roughly equal to the combined output of Asia and Africa.”

(% of global output, 2014)

7. The US is relying less on foreign oil. “In 2014, the share was roughly 28.5% on average — although by year-end, America’s dependence on foreign oil had dropped to 26.5%, one of the lowest levels in decades.”

(Net imports of crude oil and petroleum products as % of consumption)
8. Energy is one of America’s fastest-growing exports. “In November 2014, U.S. crude exports reached the highest level in decades, with the U.S. exporting 502,000 bpd; exports have exceeded 300,000 bpd in the past seven months and would be even higher if U.S. firms were allowed to export crude oil.”

(Monthly*, thousand barrels per day)

9. The US is (slowly) getting more energy independent. “The upshot [of the chart]: Japan and Germany are far more vulnerable to an external energy shock (think Russia cutting off gas supplies to Europe) than the United States — at least for now.”

U.S. Ratio of Domestic Energy Production to Consumption (%)

10. Lower energy prices means lower energy costs for consumers. “According to the latest figures from the International Energy Agency (IEA), only South Korea and Mexico have lower electricity costs by household than the United States. Keeping the lights on at home in America is cheap relative to European nations.”

(Electricity for households, $US per Megawatt hour)

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