Latest report from the International Energy Agency (IEA) predicts 2018 could be “record-setting” for the US as it looks set to dominate the global market.
The respected report predicts: “Relentless growth should see the U.S. hit historic highs above 10 million barrels a day (in production), overtaking Saudi Arabia and rivalling Russia during the course of 2018.”
Current crude oil prices are at their highest since December 2014, hitting $70.37 a barrel on Monday. They had pared back a little to $68.69 a barrel on Friday morning.
The IEA’s head of the oil industry and markets division, Neil Atkinson told CNBC: “What we are trying to understand is the responsiveness of the U.S. shale producers.
“And because of the dynamism of the industry, the innovation and the vast number of players in that space … to some extent, we are in unchartered waters.”
Mr Atkinson revealed the IEA is expecting a “wave of new production” in the coming months.
The high oil price is currently being driven by a major supply cut from oil producing group OPEC, aimed at getting rid of extra supplies and keeping prices high.
OPEC will need to consider its response any US production increase at its next meeting, in June 2018.
US oil production currently stands at 9.9 million barrels every day, the highest level in almost 50 years, putting it neck-and-neck with Saudi Arabia.
And a so-called “shale revolution” in US fuel production could help the US to sustain itself more effectively, reducing reliance on imports.
It comes after US President Donald Trump last year vowed to withdraw his country from the Paris Climate Change Agreement, claiming signing the accords had harmed the US’ economic prospects.
His Environmental Protection Agency has changed oil and gas industry regulations to allow companies to access more natural resources, peeling away environmental legislation introduced by Barack Obama.
While as a candidate, he also expressed a desire to bring back coal mining jobs in rural communities.