In the EIA’s petroleum supply monthly released today, it confirmed that US crude oil production for September hit an all-time high of ~13.844 million b/d. Throughout August and September, we published multiple pieces highlighting that we are seeing US crude oil production surprising to the upside in real-time. At the time, readers did not believe that the data was real, but with official confirmation, this increase did take place.
Bad News
The bad news is that despite lower rig and frac spread counts y-o-y, US crude oil production still managed to hit an all-time high. This is especially true with the weak oil price environment we saw following Liberation Day. US shale is a lot more resilient than the models suggest, and this dynamically changes how much decline we should expect going forward.
Good News
Now, if you are an oil bull, what I’m about to tell you might just be music to your ears.