U.S. shale producers are increasing oil output by enhancing drilling efficiency without additional spending, as they extend wells and use advanced fracking techniques.
Companies like Chevron and Diamondback have raised their production targets due to these efficiency gains.
These improvements are contributing to a projected rise in U.S. oil production by about 500,000 barrels per day by the end of the year, surpassing earlier forecasts.
This growth is expected to lead to an oversupply in the oil market, especially as OPEC plans to unwind its output cuts.
Despite consolidation among shale producers and falling rig counts, which might slow future growth, current efficiency gains are driving higher production levels.
U.S. production from the Permian Basin reached 6.2 million barrels per day in June, the second highest on record.
Source: Reuters