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US oil production rose to record high in October, EIA data shows

US oil output hit record high 13.46 mln bpd in Oct - EIA

US oil production rose 260,000 barrels per day (bpd) month-over-month to a record 13.46 million bpd in October as demand surged to the highest levels since the pandemic, data from the US Energy Information Administration showed on Tuesday.

US oil output has grown rapidly last year as drilling operations became more efficient in the country, even as concerns of oversupply have weighed heavily on prices for the commodity amid weaker-than-expected demand growth, especially in China, the top oil importing nation.

Year-over-year, US oil production rose 2.3 per cent in October, while West Texas Intermediate (WTI) crude futures prices averaged 16 per cent lower during the month, according to Reuters calculations. WTI and global benchmark Brent crude are on track for their second consecutive annual losses in 2024.

Still, the pace of growth of US oil output is moderating, analysts said. Annual oil production growth in the US is tracking around 300,000 to 400,000 bpd in 2024, versus nearly a million bpd in 2023, said Alex Hodes, energy analyst at brokerage StoneX.

“There have been a few infrastructure constraints that have kept production somewhat muted but I would expect that we will see a lot of the same in 2025,” Hodes said.

Strong US oil demand in October was the biggest surprise in the EIA’s Petroleum Supply Monthly report, UBS analyst Giovanni Staunovo said.

Total US oil demand rose by about 700,000 bpd from September to 21.01 million bpd in October, the highest since August 2019, EIA data showed. Demand for distillate fuels, which include diesel and heating oil, rose to 4.06 million bpd in October, the highest in a year.

“The weak oil demand growth narrative seems not be confirmed by data,” Staunovo said. “Likely we will see some 2024 demand growth upward revisions by energy agencies in January.”

Oil output from top producer Texas rose to a record 5.86 million bpd in October, up about 55,000 bpd from September.

US Gulf of Mexico oil output rebounded to 1.76 million bpd in October, up 191,000 bpd month-over-month, after hurricanes forced prolonged closures of production facilities in the region in September.

Oil output fell 3.6 per cent to 1.16 million bpd in North Dakota, as wildfires swept the region in October.

Natural gas production from US Lower-48 states averaged 115.87 billion cubic feet per day (bcfd), up 1.2 bcfd from September, as Texas output rose to a record 36.49 bcfd.