In January, U.S. crude oil production witnessed a notable decline, dropping to 12.5 million barrels per day (bpd), marking a 6% decrease from December’s peak, as per data released by the Energy Information Administration (EIA) on Friday.
The data revealed that crude oil output in Texas, the leading oil-producing state, experienced a reduction to 5.4 million bpd in January, reflecting a decline of approximately 5% compared to the previous month. Similarly, production in North Dakota witnessed a substantial drop, plummeting nearly 13% to 1.1 million bpd.
This decline was attributed to a severe winter storm that swept through the nation in January, causing widespread disruptions in oil production and refinery operations in Texas. The adverse weather conditions led to a sharp decrease in oil output, with U.S. crude oil production hitting record highs of 13.3 million bpd in December. Notably, major oil-producing states such as Texas, North Dakota, and New Mexico all recorded unprecedented levels of crude oil production during those months, according to EIA data.
However, the frigid temperatures in January severely impacted North Dakota’s oil production, halving it to between 600,000 bpd and 650,000 bpd, as reported by the state’s pipeline authority at the time. Other key U.S. oil-producing regions also experienced significant disruptions due to the adverse weather conditions.
Furthermore, the winter weather adversely affected the consumption of motor fuel in January, with gasoline product supplied, serving as a proxy for demand, plunging by approximately 600,000 bpd to 8.2 million bpd, marking its lowest level in two years, according to the EIA’s monthly petroleum status report.
In addition to crude oil, gross natural gas production in the Lower 48 states of the U.S. also experienced a decline, falling by about 3.6% to a record 114.1 billion cubic feet per day (bcfd) in January. This was a decrease from the previous record of 118.4 bcfd set in December, as reported by the EIA. Specifically, monthly output in Texas witnessed a decline of 4.6% to 33.5 bcfd, down from a record 35.1 bcfd in December, while Pennsylvania saw a decrease of 1.5% to 21.3 bcfd during the same period.