The United States saw its crude oil production hit 11.3 million barrels per day in August and is now the world's top producer, with the bigger-than-expected gain attributed to efficiencies in pipe, rail and truck transportation, according to a new report.
The U.S. Energy Information Administration said it had assumed that pipeline capacity constraints in the Permian region would dampen production growth. However, "efficiencies in pipeline utilization and increased trucking and rail transport" allowed production growth to continue at a higher-than-expected rate, the agency said in a a report on Thursday.
Production rose from 10.9 million in July -- August was the first time output exceeded 11 million barrels per day, the EIA said.
Production reached a record high in several states in August. Texas had the highest record level at 4.6 million barrels per day, and production in the offshore Gulf of Mexico hit a record high of 1.9 million daily barrels.
"U.S. crude oil production has increased significantly during the past ten years, driven mainly by production from tight oil formations using horizontal drilling and hydraulic fracturing," the agency said.
Crude oil production in the U.S. had reached a previous peak in 1970, with 9.6 million barrels per day, before it started a decline to the point that crude oil output nearly halved by 2008, when increased consumption led to the need for rising imports.
Hydraulic fracturing technology started to reverse the decline at that time and helped to reduce geopolitical risks, but it poses other risks.
Fracking -- well known as having made output increases possible in recent years -- consists of pumping a slurry of sand, water and chemicals underground at high pressure.
"Most of the fluid is water and sand and less than 1 percent is chemical additives. Unfortunately, some of those chemicals are toxic in very small quantities so 1 percent is more than enough to be dangerous," a report from InsideEnergy.org said.
Some countries, like France and the Netherlands, as well as U.S. states, including New York and Vermont, do not allow fracking due to health concerns.
The U.S. overcame production in Saudi Arabia and Russia. According to recent reports, current Saudi Arabian production is being ramped-up to 10.7 million barrels per day, from 9.9 million barrels per day. Russia's current oil production is estimated at about 11 million barrels per day.