The 19th century was a period of great and rapid change that left an indelible mark on the US and the world. The iron and steel industries spawned new construction materials. Railroads connected cities and towns across the country. All that was left was to wait for the arrival of a new source of fuel.
The discovery of Spindletop Geyser in 1901 was that defining moment. This new fuel source drove huge growth in the oil industry and allowed the US to become one of the top oil producing countries in the world.
Very soon, oil became the dominant fuel of the 20th century and an integral part of the American economy. Before the Industrial Revolution, agricultural staples like corn and wheat ruled the commodity market. These days, world oil and its derivatives are the most actively traded commodities on the planet.
That’s not that surprising, considering that oil affects just about every aspect of the global economy, from consumer goods to their production and transportation. Many would argue that we’re producing and using too much of it, but that’s a conversation for another day.
Oil resources are not distributed evenly across the globe; the top 5 oil producing countries account for more than 75% of the world’s oil production, while roughly 95% of the world’s oil reserves belong to a few nations. Oil prices are growing as supply fails to keep pace with rising demand, a trend that could affect both economies and climates across the world.
Before we take a deeper look at the oil industry, let’s start with some basic terminology.
What is crude oil?
Crude petroleum can be refined to produce many of the products we use every day, including gasoline, diesel, and a multitude of petrochemicals. In fact, you might be surprised to learn that less than half of a 42-gallon barrel of oil actually goes towards fuel production. The rest of it is used in the production of consumer goods like plastic, synthetic textiles, computers, cosmetics, and even steel.
Crude oil is not only valuable because of its usefulness; it’s a non-renewable resource, which means there’s only a finite amount of it to go around.
In a financial sense, oil is a “fungible” commodity. In other words – specific grades of oil are identical for oil trading purposes, no matter which of the world oil reserves it comes from. For instance, 1,000 barrels of WTI crude oil is considered exactly the same product whether it was extracted in Texas or Pennsylvania.
Oil supply and demand play a major role in pricing. Nowadays, the global mobility of resources levels some of the natural price pressures that occur when oil is in short supply. The emergence of new resources – like the Canadian oil sands and US shale oil – may also help with this.
What are shale oil and fracking?
You might not have stumbled across the term shale oil, but chances are you’ve heard about hydraulic fracturing or “fracking.” So, what is shale fracking and why has this process raised so many eyebrows? Well, shale oil fracking is the process of obtaining shale oil, which is high-quality crude oil that lies between layers of shale rock.
Oil producers extract shale oil by fracturing those layers of rock. Afterwards, they pump high-pressure bursts of water, sand, and chemicals into the ground to hit targeted spots.
There have been many concerns when it comes to the shale oil fracking process, since it includes drilling down as far as two miles where those layers exist. One of these concerns is the fact that fracking uses a lot of natural resources. Before the first drop of oil is extracted, frackers must pump over 800 truckloads of water into the hole. There are hundreds of truckloads of other materials involved in the process, too.
Perhaps the scariest thing, though, is that the effects of this process remain unknown, since the frackers don’t have to comply with the Safe Drinking Water Act. This means that even the top oil producing countries in the world have no idea what effect these chemicals could have on the water table.
Most of the water that gets pumped in returns to the surface. However, that water is now contaminated by unknown underground chemicals, which in some cases includes trace amounts of radioactive materials. Many scientists around the world are studying the long-term impact this water has on the environment, but activists are rightfully concerned.
The World Energy Congress has estimated the world’s total shale oil reserves at a little over 6 trillion barrels, given that the world’s other oil reserves are believed to amount to 1.7 trillion barrels.
OPEC – changing the world
Up until the middle of the 20th century, the United States was on the list of top ten oil producing countries and, thus, controlled a large share of the oil market. However, this changed on September 10, 1960, when the Organization of Petroleum Exporting Countries (OPEC) was established at a conference in Baghdad, Iraq.
The founding members of this organization included Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela. These countries agreed that they needed to create an organization that could bring some degree of stability to the world oil market. OPEC agreed to coordinate energy policies and ensure a fair price and steady supply to the countries of the world.
The establishment of OPEC occurred at a time of great transition in the international economic and political landscape. At that time, the international oil market was completely controlled by the “Seven Sisters,” a group of multinational companies that operated the majority of oil fields around the world.
As soon as OPEC took over the oil market, a battle broke out over export limits. Each country wanted to export as much as possible, flooding the market with cheap oil which completely decreased the price of oil. This came to a head during the Six-Day War in 1967, when Israel launched a preemptive military strike against its Arab neighbors, resulting in many Middle Eastern OPEC members wanting to boycott Israel. The embargo failed because Venezuela and Iran didn’t support it. Although the consequences of this event were felt in the following years, the organization continued to work without too many major obstacles.
In 1968, OPEC released the Declaratory Statement of Petroleum Policy in Member Countries, which was created to enshrine the right of every country to have complete sovereignty over their natural resources. Many OPEC countries were former colonies that had trouble pushing back against the dominance of powerful petroleum companies based in wealthier countries. OPEC believed the top oil producing countries should have control over their own oil.
By this time, OPEC was supplying 56% of the world net daily target of oil, which was an upgrade from 47% in 1965. However, in 1973, Egypt and Syria launched an attack against Israel, which became known as the Yom Kippur War. The US intervened on the side of Israel. Unfortunately, aside from the violence, this also had terrible consequences on the global economy.
The US supplied Israel with weapons, which angered OPEC Arab members, who responded with an embargo on oil sales to the US, Canada, Japan, the Netherlands, and the UK. In spite of the embargo, these countries were able to get oil from other sources. However, the tightening of supply resulted in a sharp rise in price, which in turn affected global energy consumption.
This embargo highlighted a global shift in political and economic power. There was now an emphatic answer to the question: What are OPEC members capable of? It was clear that they actually had the power to influence rich countries by manipulating oil supplies. While OPEC countries didn’t have a monopoly over the oil market per se, they still controlled the largest oil reserves, meaning their lack of cooperation would be felt around the world.
This decade began with concerns that crude petroleum would become scarce very soon, and these predictions drove the search for alternative energy sources. OPEC countries tried to mitigate rising prices by introducing other fuel sources such as coal, nuclear power, and natural gas. Many studies were undertaken to encourage the switch from oil to the use of nuclear power in the top countries for producing oil.
The Iranian Revolution in 1979 and the subsequent Iran-Iraq war (1980-1988) resulted in a limited supply of oil coming from Iran. By July 1980, the price of oil was around $30 per barrel – more than double 1978 price of $12.70.
Moreover, many 2nd world countries began to burn coal as a way of avoiding now-expensive oil. Advances in the North Sea resulted in massive increase in production and, by 1973, the USSR had become the world’s top oil producer, thus eating into OPEC’S share of the market.
In response, the top producing countries in OPEC started to lose control of the monopoly they had created. OPEC was now forced to raise prices and place a cap on output. This was done in the hope that limiting the supply would cause the price to rise. The quota was set at $17.5 million barrels per day. However, some OPEC countries were strongly against this limit. Both Saudi Arabia and Iran produced more than their daily allowance in an attempt to capitalize on the void left by lower production in other countries.
Even though the oil price OPEC determined did rise, the market was set for another crash. In 1986, oversupply caused the price of oil to drop. The rally of oil prices helped revive revenues, but the prices did not recover to those pre-1986 highs.
The 1990s – Present
After the end of the Iran-Iraq War, the top oil producing countries in the world including OPEC – experienced another brief period of stability and growth. But in 1989, the USSR dissociated into a number of republics, which led to a major disruption in that country’s once-stable production of oil. Moreover, soon enough Iraq invaded Kuwait and demanded that OPEC reconsider its production caps. This was mainly because Iraq was struggling to rebuild and wanted to export more oil with the goal of increasing its revenues.
During this decade, both Ecuador (1992) and Gabon (1995) left OPEC, seeking a release from the terms of the organization so they could increase their oil production. Both have since rejoined.
They 2003 invasion of Iraq by a US-led coalition resulted in another drop in supply, but other OPEC country members were able to fill in that gap, Saudi Arabia in particular. Other conflicts in Libya (2011-present), attacks on Nigerian infrastructure, and the ongoing conflicts in Iraq and Syria have been causing periodic disruptions in supply in recent decades.
OPEC Share of World Crude Oil Reserves, 2018 (Percentage)
|OPEC proven crude oil reserves, end of 2018 (billion barrels)|
|Venezuela 302.81 / 25.5%||Kuwait 101.50 / 8.50%||Algeria 12.20 / 1%||Gabon 2 / 0.2%|
|Saudi Arabia 267.03 / 22.4%||UAE 97.80 / 8.2%||Equador 8.27 / 0.7%||Equatorial Guinea 1.10 / 0.1%|
|IR Iran 155.60 / 13.1%||Libya 48.36 / 4.1%||Angola 8.16 / 0.7%|
|Iraq 145.02 / 12.2%||Nigeria 36.97 / 3.1%||Congo 2.98 / 0.3%|
Source: OPEC Annual Statistical Bulletin, 2019
Usage and Production By Country
The organization of the Petroleum Exporting Countries (OPEC) was found in Iraq, with the signing of an agreement by five countries: Republic of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.
OPEC was later joined by Qatar, Indonesia, Libya, the United Arab Emirates, Algeria, Nigeria, Ecuador, Gabon, Angola, Equatorial Guinea and Congo.
Today, OPEC includes the following list of top oil producing countries:
- Equatorial Guinea
- Saudi Arabia
- United Arab Emirates
Oil production is measured in barrels per day (BPD). This is quite literally a head count of how many barrels a country fills with oil on a daily basis. So, what are the top oil producing countries? The following segment will go into detail about the amount of oil these countries are responsible for producing, as well as exploring other details relevant to global oil production.
The United States
If you’ve been wondering which country produces the most oil, this might be the first nation you think of. Every day, the United States produces an average of 15,647,000 barrels. This has been a top oil producing country for years, and it’s also one of the greatest consumers of oil. Its production fluctuates alongside market prices and according to the International Energy Agency’s forecasts. The US will continue to enable world oil consumption with demand expected to increase over the next five years.
In 2012, the US overtook Russia for second place, then surpassed former leader Saudi Arabia in 2013 to become the largest producer of oil. Much of this can be attributed to shale fracking in Texas and North Dakota. In addition to producing, exporting, and distributing more oil than you could wrap your mind around, the United States has so far purchased and imported 7.26 billion barrels of petroleum products in 2019 – coming to an average of about 19.88 million BPD.
US President Donald Trump has criticized OPEC’S cuts, saying they have resulted in oil prices skyrocketing. He has also instigated sanctions against Russia and Iran, while also pulling the US out of the Iran nuclear deal.
The Kingdom of Saudi Arabia, which is the de facto leader of OPEC and one of the top 5 oil producing countries, is currently assessing whether it will need to ask other OPEC members to temporarily raise production to calm markets until its own output can recover. Considering the country’s rich oil reserves – the second-highest total after Venezuela – and the production rate of whopping 13.24% of the world’s oil, the House of Saud appears secure. Over the past couple of years, Saudi Arabia has fallen slightly in oil production by country rankings. However, taking into account its energy production including natural gas and biofuels, the Kingdom of Saudi Arabia still sits very comfortably.
In 2017, Saudi Arabia’s output was 12,090,000 BPD, which climbed to 12,419,000 BPD a year later, making it one of the top oil producing countries in 2018. However, these numbers fluctuate quite a bit. In March of 2019, Saudi Arabia’s output came in at a similar figure to its 2018 levels. Just one month earlier, though, that number had fallen to 10,140,000 BPD. The country’s oil and gas sector accounts for about 50% of its GDP and around 85% of its export earnings.
Besides being one of the biggest oil producers, Saudi Arabia plays a key role in OPEC’S operations. Alongside the US and Russia, Saudi Arabia attended this year’s G20 summit in Argentina, where global energy supply was a major topic of discussion.
When it comes to oil supply, Russia is one of the major players. The country has one of the largest petroleum industries in the world, and is also the largest exporter of natural gas on the planet. With the second-largest coal reserves and the eighth-largest oil reserves, Russia has an undeniable influence on the global energy market.
Russia became one of the top oil producing countries in 2017 when its output reached 11,210,00 BPD. This trend continued over the next two years, with Russia’s oil production growing to 11,401,000 BPD in 2019. Most of Russia’s reserves are based in West Siberia, the Ural and Volga regions, and towards the Caspian Sea.
According to financial experts, Russia could be one of the few countries to benefit from US sanctions on Iran. If Iran toes the line on sanctions, then several major oil consumers – including China, France, Turkey, and Italy – could soon be relying on Russia for oil production. This would give Russia an enormous economic boost and improve the relations between those countries. However, it seems Iran doesn’t intend to abide by the sanctions.
As the third-largest country in the world by area, it’s perhaps surprising that China falls behind the top oil producing countries in the Middle East, many of which are a tiny fraction of the size. However, this goes to show that population size and land area doesn’t have much to do with oil production.
Although China produces a significant amount of its own oil, China’s huge population means its need for oil is extremely high. As such, it has invested a lot into African resources. But what African country is the largest supplier of oil to China? Well, in 2016 it was Angola, which sent 1.4 million BPD directly to China.
China’s investment allowed the top oil producing countries in Africa in 2017 to improve their annual revenues. Nevertheless, China is still a major player when it comes to world oil production. Now, in 2019, the world’s most-populous country produces 4,816,000 BPD of oil. With its rapidly growing economy, factors that have driven its overall energy demand resulted in such high numbers. Despite recent U.S. sanctions, big portion of the oil that China produces is actually extracted from regions in Iran. This region has always been a touchy subject, especially when it comes to oil reserves.
The U.S. tariffs on China amount $550 billion worth of Chinese imports. When the US announced these measures, China immediately retaliated with corresponding tariffs. In July 2019, President Trump’s administration released a list of 10% tariffs on an additional $200 billion worth of Chinese goods, but Chinese officials said the country would take corresponding measures to counter this threat. The brewing trade war between China and the United States poses the risk to the global economy, including oil prices.
That said, China remains one of the top oil producing countries in Asia. Presumably, it also hopes to have Iran as an oil source for years to come.
Iraq is the least-explored country for oil reserves. It’s believed the country contains massive but as-yet undiscovered oil reserves that could provide hundreds of billions of barrels. Once this potential is realized, Iraq could become one of the top countries for producing oil. Since Iraq has been the subject of UN economic sanctions since 1990, its oil exports have been overseen by the Office of the Iraq Program. That means Iraq is not subject to OPEC limitations on production.
As of 2002, Iraq’s crude oil production catered to about 2% to 2.5% of world oil use. However, according to the most recent figures, Iraq is supplying up to 5% of the world’s oil. Unsurprisingly, Iraq’s oil-refining capacity today is significantly lower than it was before the Gulf War. As it stands in 2019, Iraq exports around 4.6 million BPD of oil, compared to 7 million BPD before the Gulf War. Iraq’s cooperation with other top oil producing countries has traditionally been lukewarm. However, its output is expected to increase, thanks in part to an agreement reached in February 2019 between Iraq and Jordan on the trade of oil and goods.
Iran’s oil supply comes in right behind some of the largest countries in the world; it produces 4% of the planet’s oil. Compared to a country like China, which is about 20 times more populous, that’s impressive.
Iran made the top oil producing countries in 2018 list with an output of 4,471,000 BPD, but that decreased slightly by the end of the same year. Output in 2019 recovered, rising to 4,695,000 BPD, and predictions for the future seem even brighter. According to the US EIA, Iran has the world’s fourth-largest total oil reserves. However, in spite of those abundant reserves, Iran’s oil production has fallen substantially in recent years.
US sanctions and regional disputes have all affected Iran’s energy production. Two main shipping operators – Maersk Line and Mediterranean Shipping – have said they plan on winding down general cargo shipments to and from Iran. This has resulted in tanker owners moving their vessels to other top oil producing countries in the Middle East and West Africa.
This could have far-reaching consequences for world oil consumption, since blocking Iran’s crude carriers will surely have an effect on the largest oil buyers. As a counter, Europe set in motion its offering to Iran, in the hope of preserving the Iran nuclear deal in exchange for enacting a blocking statute that would allow European top oil companies to do business with Iran during the embargo. Time will tell how the country will react to these developments. But in the meantime, Iran continues to sell oil in impressive quantities.
Oil Prices Over the Years: Unpredictable Variations
The world has experienced 19 oil market disruptions over the past 40 years. There are two grades of crude oil that set the benchmark for other oil prices: West Texas Intermediate, which is the yardstick for US oil prices, and Brent North Sea oil, which comes from Northwest Europe and is the benchmark for global prices.
In February 2019, the average price of Brent-WTI sunk to $10.60 per barrel due to US oversupply. This was after Congress a removed 40-year ban on US oil exports.
In 2016, the global oil price hit a low of $26.55 per barrel. But if you go six months further back, you’ll be shocked to see that the price was then $60 per barrel. Moreover, in June 2014, the price hit a remarkable average of $100.26 per barrel. These regular price fluctuations are a symptom of constantly changing conditions.
But why are petroleum oil prices so volatile? It’s important to note that major changes in the oil industry usually revolve around four fundamental factors: US oil production, uncertainty over OPEC’S clout, the fluctuating value of the dollar, and shifts in oil demand.
Throughout its history, OPEC has tried to control what are the five top oil producing countries and maintain a price of around $70 per barrel. However, new challenges have arisen, especially relating to the environment. Commitments to stop climate change have resulted in uncertainty around the demand for oil. If these demands to stop global temperatures from rising by more than 2 degrees Celsius are met, oil prices would remain around $69.6 per barrel, which is close to OPEC’S price target.
The volatility makes predicting oil prices difficult. But according to the US EIA, by 2025, the average price of crude oil will rise to $81.73 per barrel. By 2030, global demand will drive oil prices up to $92.98 per barrel. By that time, cheap sources of oil will be exhausted, making extraction even more complicated and more expensive.
Leading Oil Companies
Aramco’s history goes way back to 1933, when Saudi Arabia – which was one of the largest oil producing countries even then – signed an oil concession agreement with the company. Saudi Aramco is operating both upstream and downstream segments, meaning they search for potential underground or underwater crude oil while also supplying their consumers with petroleum products. The company’s extensive production, exploration, petrochemicals, refining, and international shipping puts it at the top of the list of the most successful oil companies in the world. In 2018, it generated over $111.1 billion in net income, leaving Apple far behind with its annual income of $59 billion.
Unlike other major oil companies, Saudi Aramco’s revenue streams are tied to a single country. This gives it the ability to influence the nation through taxation, setting production levels, and a not-so-subtle involvement in politics.
Sinopec has a much shorter history than Saudi Aramco. This petroleum and petrochemical enterprise group focuses on exploration, production, refining, and oil distribution. Established in 1998, Sinopec is a state-owned Chinese oil company based in Beijing. Its annual revenue of $377 billion is nothing short of astounding. Sinopec established its distribution service by buying shares in other petroleum company and drilling in unexplored African territories.
However, Sinopec’s actions have been heavily criticized over the years, mainly for exploiting and damaging the environment in oil rich countries. The best-known example of this is the company’s exploration of Gabon’s Loango National Park.
After the merger of Exxon and Mobil in 1999, the US multinational oil and gas company secured its spot as one of the largest refiners in the world. Its headquarters are in Texas, one of the richest oil areas in the United States. As a descendant of Standard Oil (established by John D. Rockerfeller in 1870), ExxonMobile evolved from a regional marketer of kerosene to one of the largest publicly traded oil and gas companies.
Unfortunately, its public profile as one of the biggest oil companies was tarnished after the 1989 Valdez oil spill, in which over 10.8 million gallons of crude oil were spilled in the ocean. This remains one of the most devastating environmental disasters in human history.
How Much Oil is Left?
Proven oil reserves: 302.81 billion barrels
It’s hard to believe that one of the world’s top producing countries is a nation that has been brought to its knees by an explosive political crisis. Yet despite the chaos, Venezuela has more proven crude oil reserves than any other country in the world. The current crisis in Venezuela seems to be a result of falling global oil prices and spending oil revenues on social services rather than investing in new forms of extraction. Thanks to its antiquated refineries and sub-par extraction methods, Venezuela’s crude oil production is a relatively poor 2.1 million BPD, which is down 22% from just five years ago. However, the country holds over 302.81 billion barrels worth of oil, which is nearly 18% of global reserves.
Proven oil reserves: 267.03 billion barrels
The Kingdom of Saudi Arabia has always had a strong influence on global politics thanks to its oil potential. However, the country is no longer the world leader when it comes to oil reserves and production rate. So, how much oil does Saudi Arabia have? Even though Saudi Arabia oil reserves are more than 10% smaller than those of Venezuela, the country’s cutting-edge oil-extraction methods and the accessibility of those oil reserves put it far ahead of its South American competitor.
Given that Saudi Arabia has 267.03 billion barrels in reserve, it’s no surprise the country is heavily dependent on its oil industry. Indeed, Saudi Arabia produces over 12 million BPD, which is 15.7% of global oil supplies. There are many who believe that, with advanced exploration methods, the development of Saudi Arabia oil production will soon see it reclaim top spot on the charts.
Proven oil reserves: 169.71 billion barrels
Canada has the potential to overtake other North American nations on the oil production charts, since it produces over 4.8 million BPD and its oil production has climbed 29.2% over the last half decade. When it comes to proven oil reserves by country, Canada sits in third place, with around 169,709 million barrels of oil reserves. However, the country’s economy is far from dependent on oil resources; petroleum accounted for less than 20% of the country’s $377 billion in exports in 2017.
Proven oil reserves: 157.60 billion barrels
A founding member of OPEC, Iran is one of the four countries with the largest oil reserves, with more than 150 billion barrels. Iran’s reserves are far more accessible than those found in Venezuela, which means they can be extracted quickly and efficiently. Interestingly, even though Iran has been one of the top oil producing countries since 1905, it still hasn’t depleted its rich energy resources. At its current rate of 5 million barrels per day, Iran remain one of the world’s largest oil producers.
Proven oil reserves: 142.60 billion barrels
Iraq also has some of the biggest world oil reserves, even though it, like many of its Middle Eastern neighbors, has been devastated by war and political instability over recent decades. These conflicts have resulted in an extremely poor and imbalanced economy. Iraq is heavily dependent on oil revenue, to a much greater extent than most OPEC members. So far, crude oil has accounted for 95% of Iraq’s $60.8 billion in exports in 2019. On the upside, it has reserves of 142,600 million barrels of oil reserves, and its oil production has climbed to 4.5 million BPD. This has helped stabilize Iraq, in spite of its antiquated oil-extraction methods.
Proven oil reserves: 101.50 billion barrels
Although it’s one of the smallest OPEC country members, Kuwait is one of just seven nations with oil reserves that exceed 100 billion barrels. The past few decades have been chaotic due to Iraq’s invasion in 1990. During the Iraq-Kuwait war, Iraq controlled about 20% of the world’s oil supply thanks to Kuwait’s rich reserves.
Naturally, Kuwait’s global oil production suffered. The small nation went from producing 1.4 million BPD to just 185,000 BPD, which was by far the lowest rate in the country’s history. However, Kuwait recovered, and it now produces over 3 million BPD. The country’s proven oil reserves stand at 101.50 billion barrels.
United Arab Emirates
Proven oil reserves: 97.80 billion barrels
The United Arab Emirates sources most of its oil from the Zakum Field, which holds an estimated 66 billion barrels in proven oil reserves. The UAE is an OPEC member state with a total of 97.80 million barrels in proven oil reserves, making it one of the best-developed oil exporting countries.
The oil industry is extremely important to the UAE’s economy, since petroleum accounts for 40% of its $142 billion in annual exports. Production is high at around 3.9 million BPD. With the Zakum Field resources, the United Arab Emirates is an attractive proposition for some of the largest oil companies in the world. Because it has disproportionately large amounts of oil in a small area, the UAE profits handsomely.
Proven oil reserves: 80.00 billion barrels
Russia is rich in energy resources, most of which are located in the massive oil field in West Siberia. The largest country in the world by landmass holds more than 80 billion barrels in proven oil reserves. After the collapse of the former Soviet Union, the country’s oil production slowed and it had to overhaul its processes to improve efficiency. Along with the United States and Saudi Arabia, Russia is one of the most-developed oil producing countries, with a production rate of over 10 million BPD. Petroleum accounts for 40% of the nation’s $341 billion in exports.
Proven oil reserves: 48.40 billion barrels
The largest proven crude oil reserves in Africa are in Libya, which holds over 48.40 billion barrels worth of proven oil reserves. This country has the potential to become one of the world’s largest oil producers, mainly because many more oil-rich reserves have yet to be discovered. Sanctions on foreign oil companies and deep-seated political instability are the main reasons for this.
But in spite of civil war and the consequences of the Gaddafi regime, Libya has managed to keep its status as one of the largest oil exporters in Africa. However, it has suffered a 42.7% drop in production over the past decade, and it is on track to produce fewer than a million barrels per day. Still, petroleum accounts for over 95% of the country’s $161 billion in exports.
The United States
Proven oil reserves: 39.23 billion barrels
So, where does the US get most of its oil? Proven oil reserves in the United States have reached new heights over the past decade, mainly due to unconventional extraction methods that enable the extraction of more shale oil and gas than was ever imaginable. Those methods have proven to be the most effective in Texas, where the US gets most of its oil, and where many oil companies are headquartered.
Thanks to fracking and horizontal drilling, the USA’s proven oil reserves exceeded the previous high of 36,000 million barrels in 2012, climbing to over 39 million in 2019. Still, even with that upward trajectory, the US is far behind Venezuela, Saudi Arabia, and Canada in terms of reserves. Despite its low ranking, when it comes to oil consumption by country, no country beats the United States. US crude oil production is slightly over 15 million BPD, which accounts for around 14% of daily global oil production. Overall, petroleum accounts for about 9% of the USA’s total of $2.2 trillion in annual exports.
Hopes for the Future
What happens to the oil industry is sure to be a key factor in determining the fate of humanity over the next century. The problem is not only that oil reserves are limited, but also that the production of fossil fuels has an effect on the climate and environment around the world. Geopolitical struggles among the top five crude oil producing countries are as relevant now as they’ve ever been.
Trying to work out how much oil is left has always been a fool’s game. Whenever most experts think oil reserves are on the cusp of drying up, new drilling methods prove them wrong.
The 2015 Paris climate agreement seemed to be a hopeful step towards a better future, when most of the top oil producing countries committed to cutting their carbon emissions. Since then, the biggest oil companies have been under pressure from activists, investors, and the public, but many experts remain skeptical that major oil companies will actually make the changes required to clean up the industry.
It’s expected that the introduction of longer-lasting batteries, electric cars, artificial intelligence, and robotics in oil production could increase efficiency, reduce the industry’s harmful effects on the environment, and spare the world’s largest oil reserves. However, many people doubt this will happen quickly enough to achieve the goal of limiting global warming to an average of 2 degrees Celsius above pre-industrial levels.
A balanced energy future – one that draws on existing and future technologies – could be the answer to reducing the impact of greenhouse gas emissions, while also maintaining a high standard of living across the world. Whatever happens, the top oil producing countries in the world will have plenty to think about over the coming decade.
What are the top 10 oil producing countries?
- United States
- Saudi Arabia
- United Arab Emirates
Which country has highest oil production?
The country with the highest oil production is the United States, which is responsible for producing more than 15,647,000 barrels per day.
What country has the most oil 2019?
Venezuela is the country with the most crude oil reserves in the world: 303.81 billion barrels.
Which country has the best quality of crude oil in the world?
The best-quality crude oil is found in Malaysia.
Does the US buy oil from Venezuela?
The United States was once Venezuela’s biggest cash buyer of crude oil. However, US imports of Venezuelan crude oil have collapsed to zero in the wake of recent sanctions.
Where does China get its oil from?
Russia is China’s largest crude oil supplier, followed by Angola and Iran.
Where does Russia get its oil from?
The top import origins for Russia are China, Germany, Belarus, the United States and Italy.
Does China produce any oil?
Yes. Even though China imports a large share of its petroleum products, the country itself produces 4,816,000 barrels per day.
Who runs OPEC?
The Organization of the Petroleum Exporting Countries (OPEC) is controlled by 14 oil-rich countries that have a huge influence over the world’s energy supply.
What is the best quality oil?
The best crude oil is found in Malaysia, but there’s not much of it. When it comes to the top oil producing countries, Saudi Arabia is known for offering the best quality of crude oil.
Does the US produce more oil than Saudi Arabia?
Yes, the United States produces over 15 million barrels per day, while Saudi Arabia produces around 12 million BPD.