Next year, U.S. oil producers could expand their daily output by 1 million barrels or as little as 100,000 barrels per day, with the wide gap creating enormous uncertainty as OPEC officials gather this week to weigh output barriers.
Over the past three years, shale output has routinely defied naysayers as U.S. production has risen to nearly 13 million BPD, making the nation the world's largest producer of crude oil and a major exporter so far this year with an average of just under 3 million BPD.
But the 2020 forecast arrives with the uncertainty from those within the sector - and if development falls short, it could move the power balance of world supply back to OPEC.
An increase of 1 million barrels per day in U.S. oil production will match almost 50 percent of next year's 1.2 million BPD increase in global demand, the International Energy Agency forecasts.
This would keep prices under control, press OPEC to extend production cuts and leave shale producers still trying to catch up on profits. As a the result, many industry leaders and analysts said they were anticipating slower growth in U.S. shale.
OPEC and its allies, which cut output by 1.2 million BPD, will meet to weigh their next steps in Vienna on December 5-6. The current cuts in supply are now running through March.
"I don't believe OPEC will care much more about long-term American shale output," Pioneer Natural Resources Chief Executive Scott Sheffield pointed out, adding that oil majors are the last actively producing entities in the Permian Basin, the largest U.S. shale region.
According to service company Baker Hughes, operators have trimmed down the number of oil rigs working in a row for a historic 12th month, sidelining a quarter of the country's drilling rigs in the past year.
Shale companies including Pioneer, Range Resources, EQT Corporation, and Whiting Petroleum have all lowered their production targets and decreased the number of their workforce to satisfy customer expectations for higher returns and reduced debt.
"This was a tough decision to make and one we did not take lightly, but ultimately it was a prudent and necessary action," Jeff Ventura, the chief executive officer of Range Resources told Reuters about the actions being undertaken by his team.
The company sold $1.1 billion in assets, shut facilities, and cut job positions, leveraging proceeds to buy back stocks and lower debt in the face of higher oil prices.
