EIA Drilling Productivity Report Update – May ’18
According to the EIA’s May Drilling Productivity Report, U.S. oil output is expected to continue to increase through future months. The Drilling Productivity Report uses recent data on the total number of drilling rigs in operation, estimates of drilling productivity, and estimated changes in production from existing wells to provide estimated changes in oil production for the seven key regions shown below.
May ’18 production levels were revised 0.5% above levels previously forecasted, finishing 133,000 barrels per day (bpd), or 1.9%, above Apr ’18 production levels. Jun ’18 production levels are expected to increase an additional 145,000 bpd, or 2.1%, from the May ’18 revised production levels to 7.179 million bpd, finishing at the highest figure on record. Jun ’18 production forecasts are expected to finish higher on a YOY basis for the 15th consecutive month, up 27.6% from the previous year levels.
The Jun ’18 projected MOM increase in oil production would be the 17th experienced in the past 18 months and the largest experienced throughout the past four months on an absolute basis.
Oil production is expected to remain strong within the Permian region (+2.4% MOM), while production is also expected to increase significantly MOM within the Eagle Ford (+2.5%) and Bakken (+1.7%) regions. The aforementioned regions accounted for over 90% of the total expected YOY gains in production during Jun ’18.
U.S. drilled-but-uncompleted (DUC) wells continue to set new highs since the figures began being compiled in Dec ’13. DUC wells have been drilled by producers, but have not yet been made ready for production. The Apr ’18 DUC wells figure of 7,677 finished 0.7% above the previous month, driven higher by a sharp increase in Permian DUC wells.
DUC wells, particularly in the Permian and Eagle Ford regions, will likely contribute to additional oil production heading into the second quarter of 2018.