Production has been slashed by North American oil companies faster than skeptical OPEC officials and industry analysts expected. They are on course to slash roughly 1.7 million bpd by the end of June.
Output cut by 9.7 million bpd agreed by the group of OPEC+for May and June. For total cuts of about 20 percent of world supply, the group pushed for North American countries and other non-OPEC+ members to contribute another 10 million in output cuts.
The US production expected to drop by 2 to 3 million bpd by year-end, the US Energy Secretary said in April. Because low prices would cause companies to shut production, the US officials said there was no need to mandate cuts.
As of February, US crude output was 12.8 million bpd, the EIA said. Output has plunged to 11.9 million bpd, weekly figures show. Prices in physical markets in recent days have rebounded. For production shut-ins, analysts revised their outlook due to the swift response from operators.
With 5 million bpd of output, Texas is contributing the heaviest reductions. By the end of May, the largest US producing-state output is likely to drop by 20 percent or 1 million barrels.
Output since March 1 has declined by at least 400,000 bpd in North Dakota. It is nearly 33 percent of North Dakota’s around 1.4 million bpd output before the crisis. The volume shut expected to rise further. Reducing 460,000 bpd across the US and Canada, ConocoPhillips has cut the most. Worldwide cuts of roughly 400,000 bpd announced by Exxon Mobil, with two-thirds of that from the two countries.
