For the first time since 1991, our country is meeting over 85 percent of its own energy needs.
Tulsa, OK (PRWEB) February 21, 2014
Increases in U.S. crude oil and natural gas production during 2013 has driven the U.S. to its highest level of energy self-sufficiency in two decades, according to Farmers National Company, which manages more than 120,000 oil and gas interests in 40 states. According to industry experts, growing domestic production of crude oil and natural gas continues to reshape the energy industry, giving a boost to the U.S. economy.
“Thousands of new jobs have been created in several states and billions of dollars of federal, state and local tax revenue has been generated from the continued exploration activity,” said David Smith, vice president of the oil and gas management division of Farmers National Company. “For the first time since 1991, our country is meeting over 85 percent of its own energy needs.”
Production for crude overall is rising, while consumption is slowing which will keep prices in check, said Smith. He expects West Texas Intermediate crude oil prices to potentially average $93/bbl during 2014 and to drop back to $90/bbl in 2015. Wild price swings in the past on natural gas have given way to low, yet stable prices during the past three years, according to Farmers National Company data.
“We expect the gas supply to tighten and prices to begin a slow upward trend during 2015, but they should still average below $5/MMBtu,” said Smith.
Looking at the gasoline market, prices are expected to fall in 2014, driven by strong crude oil production and aided by lack of hurricane damage to the industry’s infrastructure, stability in the Middle East and few refinery problems. According to Smith, U.S. refineries are currently operating at 92 percent capacity.
Leasing trends point to continued increases in drilling activity generating an additional one million barrels of crude per day over last years’ figures by the end of 2014. This rise in exploration will lead to a continued strong leasing market for mineral owners, said Smith. Leasing activity is strong in a number of states, including Oklahoma, Texas, Kansas, California, Colorado, Louisiana, New Mexico, North Dakota, Ohio, Pennsylvania, West Virginia and Wyoming.
“Crude oil and liquids prospects continue to be the headliners with almost 80 percent of all new leases and wells focused on oil plays,” said Smith. “If crude prices remain above $85/bbl and natural gas remains below $5.00/mcf these trends should continue.”
Fracture stimulation is the key to success for all exploration basins in the current market, according to Farmers National Company, which processed over 1,200 leases in the past year, covering all resource plays in the United States.
Overall energy commodity prices will remain fairly stable for the balance of 2014 with possible increases not occurring until sometime in 2015. A continued sluggish economy, combined with increased domestic production, will continue to keep natural gas, crude oil and gasoline prices in the low to modest range for all of 2014 and probably into 2015.
Farmers National Company, an employee-owned company, is one of the largest independent oil and gas management firms in the country. The company has been serving America’s landowners since 1929 and has the following eight lines of business: farm management, real estate sales and auctions, appraisals, insurance, consulting, oil and gas management, lake management, and national hunting leases. Located in the heart of the nation’s oil and gas production region, the company’s industry experts include Certified Professional Landmen, Registered Professional Landmen, Certified Mineral Managers, accountants, Division Order and Title Analysts, and geologists. For more information visit the Farmers National Company website at http://www.FarmersNational.com.