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NEWS ALERT February 24, 2022, 3:53 p.m. EST: Oil briefly surpassed $100 a barrel, its highest price in 8 years, following the Russian invasion of Ukraine late Wednesday night.
Oil generates revenue for countries with enough oil reserves to produce more oil than they consume. And for those economies that are heavily dependent on imports, oil expenditures must be factored into national budgets. Not surprisingly, events such as unrest in oil-producing regions, new oil field discoveries, and advances in extraction technology profoundly affect the oil industry. Most of the time, the top oil-producing countries in the world rake in a lot of profit on their production.
Global production of oil and other petroleum liquids averaged 95.5 million barrels per day (b/d) in 2021, according to the U.S. Energy Information Administration (EIA). The top three producing countries in 2020—the U.S., Saudi Arabia and Russia—accounted for 43% of the world’s petroleum liquids production. The top five producers also including Canada and China accounted for 54% of the global output.
Key Takeaways
- Despite continuing growth in renewable energy, oil production continues to play a key role in the global economy.
- According to the most recent data, the top five oil-producing nations are the U.S., Saudi Arabia, Russia, Canada, and China.
- The United States became the world’s top petroleum liquids producer in 2013 and the world’s top crude producer in 2018.
- Russia’s production has been held back by Western sanctions but its clout in the global oil market increased after it formed the OPEC+ alliance with Saudi Arabia and other key exporters.
- China’s production meets just over a third of its oil consumption. leaving it the world’s largest petroleum importer.
Below are the five countries that produced the most oil and other petroleum liquids as of 2020.
United States
The United States is the top petroleum liquids producer in the world, averaging 18.6 million b/d to account for 20% of the world’s production in 2020. It’s also the top producer of crude oil and lease condensate at 11.3 million b/d as of 2020.
In addition to crude oil and condensate, the broader category of petroleum liquids also includes natural gas plant liquids as well as biofuels. While the U.S. has been the world’s top petroleum liquids producer since 2013 thanks to surging natural gas liquids production from shale deposits, it didn’t surpass Russia and Saudi Arabia in crude oil production until 2018.
Much of the increased U.S. crude oil production is attributable to hydraulic fracturing, or fracking, in the shale formations in Texas and North Dakota. Natural gas liquids production received an even larger boost from the development of the Marcellus Shale deposits in western Pennsylvania. The United States became a net exporter of petroleum (i.e., exports exceeded imports) for the first time since at least 1949 in 2020 but returned to net importer status in 2021.
Saudi Arabia
Saudi Arabia contributes 10.8 million b/d, representing 11% of the world’s total petroleum liquids production. It holds 15% of the world’s proved oil reserves and is the largest crude exporter. Saudi Arabia is the only member of the Organization of the Petroleum Exporting Countries (OPEC) to make this list.
According to the CIA World Factbook, the petroleum sector accounts for roughly 42% of the country’s gross domestic product (GDP), 87% of its budget revenues, and 90% of export earnings. Saudi Arabia’s major oil fields include Ghawar, Safaniya, Khurais, Manifa, Shaybah, Qatif, Khursaniyah, Zuluf, and Abqaiq.
Global oil production is expected to rise from 76.1 million b/d in 2020 to 99.3 million b/d in 2050. Total petroleum liquids production is seen rising from 94 million b/d to 125.9 million b/d over the same time frame.
Russia
While Russia has dropped to third place in a ranking it led as recently as 2010, it remains one of the world’s top oil producers with an average of 10.5 million b/d in 2020, accounting for 11% of global production.
Russia’s main regions of oil production are Western Siberia, Urals-Volga, Eastern Siberia and the Far East, Arkhangelsk, and the Komi Republic. Most of the production originates from the West Siberia and Volga-Urals regions, especially the Priobskoye and Samotlor fields in Western Siberia.
The oil industry in Russia was privatized after the fall of the Soviet Union, but the state has since forced a consolidation and asserted more control over the sector. Gazprom, Rosneft and Lukoil are the top Russian oil and gas producers.
Western sanctions imposed after Russia’s invasion of Ukraine in 2014 have barred Russian energy companies from accessing U.S. capital markets and shale drilling technologies. In 2017, the 14 OPEC members and 10 non-OPEC oil exporters led by Russia formed OPEC+, which now sets export quotas for members and plays an influential role in global energy markets.
Canada
Canada holds the fourth spot among the world’s petroleum liquids producers with 5.3 million b/d in 2020, accounting for 6% of global output. The EIA estimates its crude oil and condensate production of 4.2 million b/d in 2020 could grow to 6.9 million b/d by 2050, primarily from oil sands production.
Canada’s main sources of oil production are the oil sands of Alberta, the Western Canada Sedimentary Basin, and Atlantic offshore fields.
China
China produced 4.9 million b/d of petroleum liquids in 2020, accounting for 5% of the world’s production. China passed the U.S. to became the world’s largest oil importer in 2017. China’s oil consumption of 14.3 million b/d in 2021 made it the world’s second-largest consumer in the world after the U.S.
The northeast and north-central regions of the country are responsible for the majority of domestic production. Mature fields like Daqing have been exploited since the 1960s, and companies are increasingly investing in enhanced oil recovery (EOR) techniques, such as polymer and stream flooding and water injection, to offset some of the production declines.