EIA Reports U.S. Oil Output Slides Again in July

NEW YORK (Reuters) — U.S. crude oil output fell 276,000 barrels per day (bpd) in July to 11.81 million bpd, its third monthly decline from its record high in April at 12.12 million bpd, according to a U.S. Energy Information Administration monthly report released on Monday. 

A majority of the drop in production came as federal offshore Gulf of Mexico production slid about 332,000 bpd to 1.58 million bpd, the data showed.

The slide in production comes just as takeaway capacity from the Permian Basin, the most productive play in the U.S., comes online. The Cactus II Pipeline from Plains All American has a capacity of 670,000 bpd of crude oil and began shipping in August.

The Gulf Coast Express (GCX) Pipeline from Kinder Morgan can carry up to 2 billion cubic feet per day (bcfd) of natural gas and came into service in late September, ahead of schedule.

Output in North Dakota rose by 14,000 bpd to a record 1.41 million bpd while Texas production climbed by 40,000 bpd, rising above 5 million bpd for the first time since the agency began tracking output in 1981.

A shale boom, led by output increases in Texas and North Dakota, helped make the United States the biggest oil producer in the world, above Saudi Arabia and Russia.

However, the rate of growth has slowed this year as U.S. energy firms have reduced the number of oil rigs for a record 10th month in a row as producers follow through on plans to cut spending on new drilling this year.

Meanwhile, monthly gross natural gas production in the lower 48 U.S. states rose to a fresh record high 101.34 billion cubic feet per day in July, compared with a revised 101.19 bcfd in June, according to the EIA's 914 report.

In Texas, the biggest gas producing state, output increased 1.8% to a record high of 27.96 bcfd from 27.46 bcfd in June.

In Pennsylvania, the second-biggest gas-producing state, output edged higher by 1.9% to 19.09 bcfd from 18.73 bcfd in June.

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