Commodities Buzz: US proved reserves of crude oil and lease condensate mark decline of 4% in 2023

The US Energy Information Administration or EIA stated in a latest update the US proved reserves of crude oil and lease condensate totaled 46 billion barrels at year-end 2023, a 4% decline from the previous year’s record, according to our US Crude Oil and Natural Gas Proved Reserves, Year-End 2023 report. US proved reserves of natural gas fell to 604 trillion cubic feet, a 13% decline from their 2022 record. Both declines marked the first annual decrease in US proved reserves for those fuels since 2020.

Proved reserves are operator estimates of the volumes of oil and natural gas that geological and engineering data demonstrate with reasonable certainty to be recoverable in the future from known reservoirs under existing economic and operating conditions. Prices heavily affect estimates of proved reserves.

Operators revised their proved reserves downward in response to falling prices in 2023 from the historical highs observed in 2022. Annual average wholesale prices at the domestic benchmarks for West Texas Intermediate crude oil and Henry Hub natural gas fell by 18% and 61%, respectively, between 2022 and 2023.

Oil and natural gas prices are the engine driving everything from drilling and completion activity to the amount of proven reserves available to be recovered. The Energy Information Administration reported the nation’s proved reserves of both crude and lease condensate and natural gas both fell in 2023. It was the first annual decrease since 2020.

According to the EIA, US proved reserves of crude oil and lease condensate totaled 46 billion barrels at year-end 2023, a 4% decline from the previous year’s record. US proved reserves of natural gas fell to 604 trillion cubic feet, a 13% decline from their 2022 record.

In the Permian Basin, the agency looked at reserves in the Bone Spring and Wolfcamp of both Texas and New Mexico. In 2022, production was 1.57 billion barrels and reserves totaled 15.36 billion barrels. In 2023, production increased 193 million barrels to 1.76 billion barrels and reserves increased 41 million barrels to 15.4 billion barrels.

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