U.S. oil production is booming and oil exports are following. In its latest weekly update, the U.S. Energy Information Administration (EIA) also reported that oil refining hit its highest level on record last week.
The EIA report comes after U.S. crude exports surged to a record 1.76 million barrels per day (bpd) in April. This is a big change for a country that just a few years ago wasn’t exporting any crude.
The U.S. banned crude oil exports in 1975 in reaction to an OPEC embargo that created a major crude oil shortage that sent prices skyrocketing, slamming the U.S. economy. The U.S. government overturned this ban in 2015, and shortly after, in January 2016, the U.S. started exporting crude oil.
Part of the driving factor behind the decision to restart exports was the shale oil boom, which has morphed the country into a major oil producer. The U.S. is producing oil at a record pace of 10.9 million bpd, a level which it first reached earlier in June.
This oil boom is very good for the U.S. economy. “The second quarter is going to be a very strong quarter. One of the leading indicators of this is the extraordinary rise in crude oil production,” former Fed Chairman Alan Greenspan told FOX Business’ Maria Bartiromo on Thursday during “Mornings with Maria.”
“I’ve been following the oil industry back to year one, and, I’ve never seen anything rushed this fast, he added. Fracking has made extraordinary changes in crude oil production and our output (of oil) is now close to the highest (in the world).”
The increase in U.S. production comes while oil prices have rallied to multi-year highs as production in Venezuela has tumbled amid an economic crisis. Further, the U.S. is pressing its allies to halt oil imports from Iran.