May 24 (UPI) -- Cost savings and technological improvements have contributed to the "impressive growth" from U.S. shale oil, the International Energy Agency said.
IEA Executive Director Fatih Birol delivered a presentation on the state of the global energy market from Madrid. The low price for oil, by historical standards, has put strains on conventional hydrocarbons, though renewable energy is gaining dominance.
On oil, the director's presentation said it was oil production from inland shale basins in the United States that was shaking up the oil market.
Crude oil prices dropped below $30 per barrel early last year when growth in U.S. oil production added to the supply-side strains from previous policies from some members of the Organization of Petroleum Exporting Countries to defend a market share with more oil. Birol said that U.S. shale oil production can withstand low oil prices.
"U.S. shale oil has surged in recent years and can continue to deliver impressive growth, reflecting the enormous cost savings and technological improvements made by the industry," his presentation indicated.
By IEA metrics, the cost per barrel of U.S. shale oil production peaked in the upper $70 range in 2012 and moved to around $40 by 2016.
The latest U.S. data show total crude oil production for the week ending May 12 was 9.3 million barrels per day, down about 1 percent from the previous week. The decline came in large part from Alaska as production in the Lower 48 was up slightly to about 8.8 million bpd. Year-on-year, total U.S. production for the week is up 5.8 percent. The price for West Texas Intermediate, the U.S. benchmark for the price of oil, is up about 7 percent from this week in 2016.
Most of the oil leaving the U.S. market in recent weeks, however, has come from offshore production.