According to the most recent data, the 14 OPEC member countries produce about 40% of global oil supplies. That said, only half of the top 12 oil producers belong to the organization:
Overall, those dozen nations produced 73% of the world's oil last year. And the six leading non-members of OPEC held considerable weight in the market in their own rights, since between them ,they matched OPEC's combined output at 40% of global production last year. Here's a closer look at the six countries that are helping keep OPEC's dominance at bay.
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No. 12: Mexico
While Mexico remains a major oil producer, its output has declined significantly in recent years. Since peaking in 2004, the nation's crude production is down 32% due to the natural decline of its large Cantarell field, as well as its offshore sources in the Gulf of Mexico. Because Mexico hasn't invested enough capital in developing new sources to offset these declines, it enacted a constitutional reform in 2014 that ended the monopoly that state-owned PEMEX had on the country's oil fields, hoping that would spur investment from foreign companies. One other thing worth noting about Mexico is that it remains an important supplier to the U.S.: It contributed about 7% of America's oil imports last year.
No. 10: Brazil
Mexico is following the blueprint of Brazil, which opened its oil fields up to foreign investment in 1997 to help state-controlled Petrobras (NYSE: PBR) develop the country's massive offshore resources. Overall, the plan is working: Brazil's oil output has risen more than 40% over the past decade. And more production growth is on the way, given that Petrobras is planning to invest nearly $75 billion over the next five years in developing its offshore oil fields. Those investments should boost the company's oil output from 2.07 million barrels per day this year to 2.7 million barrels per day by 2020.
No. 7: Canada
Most Americans would likely be surprised to learn that we import more oil from Canada than from all the OPEC nations combined. In fact, last year 38% of America's petroleum imports came from our neighbor to the north compared to 34% from OPEC. Further, broken out regionally, just 18% of our imported oil came from Persian Gulf nations.
More than half of Canada's output comes from the oil sands region. Unlike crude oil that is pumped from the ground in liquid from, the oil in this region is contained in a tar-like substance called bitumen; it's extracted either by mining a mixture of sand, water, clay, and bitumen, or melting the bitumen into liquid that can be then be extracted; the result is then upgraded into oil that can be refined. It's an expensive process that requires a massive upfront investment. For example, leading Canadian oil producer Suncor Energy (NYSE: SU) and its partners are investing between 16.5 billion and 17 billion Canadian dollars ($12.8 billion to $13.2 billion) in building the Fort Hills oil sands mining facility in Alberta. Suncor Energy initially started construction on the project in 2013 when crude was north of $100 a barrel. However, it won't deliver first oil until the end of this year, at a time when crude will likely still be about half that price. On the bright side, Suncor believes that Fort Hills can produce around 194,000 barrels per day for the next 50 years.
No. 6: China
China used to be a net exporter of oil. However, due to its rapid economic expansion, it's now the world's leading oil importer and accounts for about a quarter of the globe's annual consumption. Given its voracious appetite for oil, the country has been investing heavily to expand its output, which has risen 50% over the past 20 years. Meanwhile, according to projections, its production is on pace to hit more than 5 million barrels per day by the end of the decade. That increased output should come from a variety of sources, including enhanced recovery techniques on mature fields, new shale development, and deepwater resources.
No. 3: United States
The U.S. has rocketed up the leaderboard in recent years due to the impact of fracking and horizontal drilling of shale formations. Those two techniques, applied to legacy oil regions like the Permian Basin of Texas, have unleashed a torrent of new production in recent years. Meanwhile, there's plenty more oil on the way. According to the U.S. Energy Information Administration, crude output in the country is on pace to hit 10 million barrels per day next year, smashing the record set in 1970 as drillers like EOG Resources (NYSE: EOG) ramp up investment in shale plays. In EOG Resources' case, it expects to grow its oil output by 18% this year and by a 15% to 25% annual rate through 2020 as long as crude is in the $50 to $60 a barrel range.
No. 1: Russia
While Saudi Arabia is by far OPEC's top producer, and currently holds the largest oil resources in the world, it landed in second place last year in terms of average daily production after Russia delivered its best annual average of the past three decades. Fueling that gusher was an increase in investment by the country's two largest producers, Rosneft and Lukoil, to tap its vast oil reserves and replace revenue lost due to lower oil prices and economic sanctions. While Russia's output should decline in 2017 due to its decision to team up with OPEC in a coordinated cut, its oil production is on pace to keep expanding until 2020 due to several large oil projects that producers have in the pipeline.
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