Oil production

Expert Voices

Despite rise in U.S. oil production, OPEC still steers global prices

A general view shows oil pumping jacks and drilling pads at the Kern River Oil Field
The Kern River Oil Field in Bakersfield, Calif. Photo: Mark Ralston/AFP via Getty Images

Saudi Arabia announced an oil production cut of 500,000 barrels per day on Tuesday, just weeks after Treasury Secretary Steven Mnuchin said "U.S. friends in the Middle East" would compensate for the drastic decline in Venezuelan oil production driven by U.S. sanctions.

Why it matters: Although U.S. production continues to rise, it still accounts for only 11% of global consumption, compared to OPEC’s 32%. The recent supply cuts illustrate that sudden disruptions and U.S. sanctions that take oil out of the market can put OPEC, and Saudi Arabia specifically, back in charge of global oil prices.

Experts consistently underestimate U.S. oil production

Data: EIA monthly survey of producers and short-term energy outlooks; Chart: Harry Stevens/Axios
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