Oil Price
Freezing temperatures have slashed North Dakota’s crude oil production by up to 280,000 barrels per day (bpd) in recent days, according to estimates from the North Dakota Pipeline Authority as of Sunday, reported by Reuters.
Natural gas production in North Dakota also fell, due to the Arctic blast and frigid weather that has settled across much of the United States in recent hours.
Before the dip in crude oil output this weekend, North Dakota was producing around 1.2 million bpd-1.3 million bpd of oil. The all-time high of 1.52 million bpd production was reached in November 2019, just before the pandemic.
The latest available figures, for October, showed that North Dakota’s oil production averaged 1.24 million bpd during that month, slightly down from 1.28 million bpd in September, due to a snowfall in late October that curtailed some production. Most of the oil output, 97%, came from the Bakken and Three Forks formations, per the data from the North Dakota Department of Mineral Resources.
The winter freeze this weekend disrupted oil and natural gas production elsewhere in the United States, too.
Freezing temperatures in much of the United States have frozen gas wells, leading to the drop in production to the lowest in 11 months, per estimates by Reuters.
At the same time, demand for electricity, on the other hand, was heading for a record-high in some states, notably Texas. There, the grid regulator had to issue a conservation call for Monday morning on expectations that demand will break last summer’s record.
“Operating reserves are expected to be low Monday morning due to continued freezing temperatures, record-breaking demand, unseasonably low wind,” ERCOT said in the call.
Demand for electricity in the state with the biggest gas output and the largest wind generation capacity is seen reaching 85.56 gigawatts (GW) on Tuesday, according to federal energy data, cited by Reuters. Supply, meanwhile, could fall short of that by 1 GW, ERCOT has estimated.
By Tsvetana Paraskova for Oilprice.com
