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Record-setting liquid fuels production growth in the United States has more than offset the rise in unplanned global supply disruptions over the past few years, although differences in quality and location suggest that the substitution may not be exactly 1-for-1. U.S. liquid fuels production, which includes crude oil, hydrocarbon gas liquids, biofuels, and refinery processing gain, grew by more than 4.0 million barrels per day (bbl/d) from January 2011 to July 2014, of which 3.0 million bbl/d was crude oil production growth. During that same period, global unplanned supply disruptions grew by 2.8 million bbl/d.

U.S. production growth, the main factor counterbalancing the supply disruptions on the global oil market, has contributed to a decrease in crude oil price volatility since 2011. Over the past 13 months, the monthly average Brent price has moved within a narrow $5 per barrel range, between $107 per barrel and $112 per barrel. In contrast, the range of monthly average Brent prices over the prior 13-month period (June 2012-June 2013) was $21 per barrel.

Global unplanned supply disruptions averaged 3.2 million bbl/d during the first seven months of 2014 and peaked at 3.5 million bb/d in May 2014. The current level of supply disruptions is the highest since the Iraq-Kuwait War (1990-91), when supply disruptions peaked at 4.3 million bbl/d, based on data from the International Energy Agency.

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