North Dakota produced a record 1.13 million barrels of oil per day in August, the state’s Department of Mineral Resources said Wednesday.
Overall, the state’s Bakken shale formation has produced more than 1 billion barrels of oil, the state agency said. The Bakken shale, which stretches into Montana, is the heart of a domestic energy boom that has been propelled by advances in hydraulic fracturing, or fracking, technology.
The news comes as Brent crude oil prices plummeted Wednesday to just below $84 per barrel, the lowest level since November 2010, stoking fears that future U.S. shale production might be unprofitable.
Experts say the price drop underscores a move from the Organization of Petroleum Exporting Countries, the oil cartel that is largely led by Saudi Arabia, to test that point. Traditionally, the oil revenue-dependent countries curtail supply to keep oil prices high when prices fall quickly.
Some analysts contend the “break-even” price for U.S. shale is about $80 per barrel. But room for price-cutting exists in some regions where production is already underway, like the Bakken, where that break-even price might be lower than $70 per barrel.
Fears of an $80 per barrel break-even point for U.S. shale might be overstated, according to the International Energy Agency. It said just 4 percent of U.S. shale production would be unprofitable at prices below that level, according to Bloomberg.
Sagging oil demand, combined with booming U.S. production and unexpected gains from Libya, also has contributed to the price fall. The IEA said Tuesday that global oil consumption would grow 650,000 barrels this year up to 92.7 million barrels, the weakest increase since 2009.
