Angola's Oil Output Falls Short, US Production Surges Amid Election Frenzy
The global oil market is witnessing a tale of two nations, as Angola's crude output falls 8% below forecast at 1 million barrels per day (bpd), while the United States sees a surge in production, breaking records and defying expectations. The contrast couldn't be more stark, with Angola's struggles threatening to disrupt global supply, while the US boom is reshaping the energy landscape. As the world watches, the oil market is poised to play a pivotal role in the upcoming US presidential election, with both candidates taking starkly different stances on fracking.
Angola's underwhelming output comes as a surprise, given the country's rich oil reserves. The 8% shortfall will likely have a ripple effect on global prices, putting pressure on OPEC to fill the gap. Meanwhile, the US oil industry is riding high, with production reaching a record 12.9 million bpd in 2023 and continuing to climb in 2024. The Permian Basin has been a key driver of this growth, with companies like EOG Resources, Coterra Energy, and Matador Resources increasing their production forecasts. However, analysts warn that this trend may be slowing, as high-quality drilling locations dwindle and consolidations acquire remaining acreage. Additionally, major oil field service providers like Halliburton and SLB are reporting a drop in North American sales, as companies optimize their US assets and focus on international exploration.
The oil market is increasingly becoming a political hot potato, with both US presidential candidates taking opposing views on fracking. Vice President Kamala Harris, the Democratic nominee, has shifted her stance on fracking, attempting to woo voters in crucial swing states like Pennsylvania. Former President Donald Trump, the Republican nominee, has been a steadfast supporter of fracking, dating back to his 2016 presidential campaign. The US Energy Information Administration (EIA) reports that shale operators drilled more wells than were fraced in April, marking the industry's first back-to-back months of increased drilled-but-uncompleted wells since 2022. This trend is expected to continue, with BloombergNEF predicting a 600,000 bpd increase in US oil production in 2025, thanks to higher well productivity.
As the world navigates the complexities of the oil market, one thing is clear: the US is emerging as a dominant player, while Angola's struggles pose a threat to global supply. The outcome of the US presidential election will have far-reaching implications for the oil industry, with fracking taking center stage in the debate. As the world watches, one thing is certain – the future of oil production hangs in the balance, and the consequences will be felt for years to come.