Crude oil futures surge to Rs 4245 per barrel

The US oil production exceeded 10 million barrels per day for the first time in four decades

The West Texas sky silhouettes a Linn Energy pumpjack in the.

US output surged above 10 million barrels a day for the first time in more than four decades in November, the Energy Information Administration reported Wednesday.

The EIA also reported the biggest increase in crude oil stocks since March past year, a rise of 6.8 million barrels.

"American crude oil is a game-changer in worldwide trade, global politics and domestic energy security", said Todd Staples, president of the Texas Oil & Gas Association, a trade group.

Goldman Sachs drew an even more bullish conclusion, saying in a note to clients Thursday that "the rebalancing of the oil market has likely been achieved, six months sooner than we expected".

However, not all analysts are convinced that America's oil production spurt will continue. OPEC countries have suffered the most as their light blends are being displaced by USA shale. According to the EIA, global oil demand increased to 98.38 million barrels a day in 2017 up from around 92 million barrels of oil a day in 2015.

Oil prices could be headed for a big downturn in 2018 and beyond. OPEC members are enjoying the extra income, though some in the group have expressed concern that it could encourage USA shale and other supply from outside producers. Dollar strength hasn't been much of a concern over the past year, and the continued weakness in the Greenback has surely been a positive factor for Oil prices.

The forecast for Oil prices will be set to neutral for the week ahead. If we assume that's the level oil prices drop to in 2018, it means a decline of over 16%. The ship is not ready to begin producing just yet as there are a few more modules on the way that will enhance the vessel's capabilities. Energy companies are again reporting solid profits and hiring workers.

In other words, we have no oil glut! The bank also said rising United States shale supply will be needed to keep the market steady in the near-term, since any ramp-up in OPEC production will lag the rebalancing.

To read this article in one of Houston's most-spoken languages, click on the button below. As a result, the slowdown in USA exports could create an additional factor sup-porting fuel prices in the short term. A decade ago, falling domestic production and a USA ban on exports meant that WTI served mostly as a proxy for US inventory levels."There was a time when the USA was disconnected from the global market", said Greg Sharenow, portfolio manager at PIMCO, who co-manages more than $15 billion in commodity assets. It had crossed that figure twice - in October and November of 1970, but after that it had embarked on terminal decline until shale oil came along over the past decade to revive its oil fortunes.

A new floating production storage and offloading vessel (FPSO) arrived in Nigeria this week, adding 200,000 barrels per day to offshore output capacity.

American production isn't only expanding in onshore shale.

Indeed, the USA producers' resilience threaten to disrupt OPEC and Russian machinations to control global oil markets. Goldman says that the global oil market was in a 1.1 million barrel a day deficit in the fourth quarter of 2017.

The company also announced a new discovery in the Gulf of Mexico in the Whale deepwater block that is co-owned with Chevron.

The strength in the market was welcomed by key players, especially the worldwide oil companies who are reporting this month.

WTI for March rose 54 cents to $65.27 a barrel on the New York Mercantile Exchange at 10:37 a.m. London time, after adding 23 cents on Wednesday.

As a result, US consumers should expect higher gasoline prices. They should peak sometime around late summer, but that will probably be followed by a quick slide back to near current prices.

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