World's biggest oil producers

Discover the world’s top oil-producing countries of 2020. In this article, you will learn more about the oil industry and find out how to get exposure to the commodity with IG.

Top 10 oil producers in 2020

  1. United States: 19.51 million bpd
  2. Saudi Arabia: 11.81 million bpd
  3. Russia: 11.49 million bpd
  4. Canada: 5.50 million bpd
  5. China: 4.89 million bpd
  6. Iraq: 4.74 million bpd
  7. United Arab Emirates (UAE): 4.01 million bpd
  8. Brazil: 3.67 million bpd
  9. Iran: 3.19 million bpd
  10. Kuwait: 2.94 million bpd

This list shows the amount of barrels per day (bpd) produced per country as at 25 June 2020. Oil production figures change regularly. (Source: EIA)

Oil industry overview

The oil industry is one of the most watched sectors in the world, partly due to its reputation for high volatility. Like any other financial market, the biggest factor controlling the price of oil is the relationship between supply and demand.

Supply factors that affect the price of oil include production decisions made by the Organization of the Petroleum Exporting Countries (OPEC), geopolitical issues and severe weather conditions. OPEC holds regular meetings to set up oil production quotas for member countries, with the aim of regulating the supply of oil and controlling its price. Demand factors include reliance on oil, the price of the US dollar and global economic performance.

The top 10 biggest oil producers supply 71% of the world’s oil, which is more than 100 million barrels per day. The oil is mainly used in transportation (petrol and diesel), but it also supports the production of certain lubricants, plastics and pharmaceuticals.

The two most popular oil benchmarks in the world are Brent crude and West Texas Intermediate (WTI). The main differences between them relate to their respective extraction locations and compositions, and how they are affected by geopolitical factors.

Learn more about these oil benchmarks

Top oil-producing countries

Country Share of global production
United States 19%
Saudi Arabia 12%
Russia 11%
Canada 5%
China 5%
Iraq 5%
UAE 4%
Brazil 4%
Iran 3%
Kuwait 3%

United States: 19.51 million bpd

The United States has been the top oil-producing country in the world since 2017. Here, oil is produced in 32 states and in US coastal waters – the majority of which is drilled in Texas (41%). The country is also the biggest consumer of oil, using a total of 7.47 billion barrels of oil in 2019.

One of the main reasons why the US is a leader in oil production is because it was the first country to adopt new methods of drilling. Rigs can now drill horizontally, enabling greater access to oil-yielding rock. Between 2018 and 2019, oil production in the US increased by just over 9%.

Saudi Arabia: 11.81 million bpd

Before the US became the world’s largest oil producer, Saudi Arabia held the top spot for a few years. It is the sixth largest consumer of the commodity, using an average of 3.78 million barrels per day.

Following OPEC cuts, Saudi Arabia’s oil output declined by 609,000 barrels per day from 2018 to 2019. It was slashed by a further 3.30 million bpd in 2020 – following lower demand due to Covid-19. These production declines are cause for concern domestically, because oil production in Saudi Arabia is responsible for around 42% of the country’s gross domestic product (GDP).

Russia: 11.49 million bpd

Russia was once the leading oil producer in the world, before it was overtaken by Saudi Arabia, and later the US. Overall production growth between 2018 and 2019 was less than 1% as OPEC and large Russian oil producers agreed to slow down production due to lower oil prices. Then, in early 2020, Covid-19 curbed output by up to 20%.

The country’s main extraction region is in Western Siberia, from the Priobskoye and Smotlor fields. As of June 2020, Russia is the fifth largest consumer of oil (3.31 million bpd), which accounts for about 4% of the world’s total.

Canada: 5.50 million bpd

Canada is slowly climbing the list of leading oil producers, up from number five (2018; 5.29 million bpd) to number four. Production is said to increase by more than 120% by 2050 – surpassing the growth rate of all non-OPEC countries. Though the drastic increase in production may be expensive, as most of Canada’s oil (96%) comes from oil sands, the country has access to the technology to bring the cost down.

Oil consumption in Canada is just over 2.4 million bpd and it has enough oil to last over 180 years at the current rate of consumption. Further plans for the future include expansion to trade agreements, which is expected to be concluded by December 2022.

China: 4.89 million bpd

China is the fifth largest producer of oil in the world, but it is the second largest consumer – using around 14 million barrels per day. This is one of the reasons why the market reacted so drastically to the drop in oil demand (more than half a million bpd) from China as a result of the Covid-19 pandemic.

Most of China’s domestic oil is extracted from the north-east and north-central region. Overall, oil production in China has dropped slowly and, at current production and consumption levels, it has about five years’ worth of proven reserves.

Iraq: 4.74 million bpd

Between 2018 and 2019, Iraq’s oil production increased by 2.6%, bringing output up to 4.74 million bpd. It holds around 9% of the world’s oil reserves, which is more than 140 billion barrels.

While it is only number six on the list of leading oil producers, it is the second largest of the OPEC countries. It is also the second largest exporter of the commodity, globally. Iraq’s crude oil exports have doubled from 2 million bpd to 4 million bpd since 2010 – most of the oil is supplied to China, India and Europe.

UAE: 4.01 million bpd

The third OPEC country on the list of leading oil producers is the United Arab Emirates (UAE). The last time the country produced more than 4 million bpd was in 2016, after which it dropped by 3.1% (2017).

At 98 billion barrels, the UAE’s oil reserves have remained somewhat unchanged since 1988. At the current rate of production and consumption, this means the country has enough reserves to last almost 300 years.

Brazil: 3.67 million bpd

Brazil saw a significant increase in oil production from 2018 to 2019, and again in 2020. By December 2019, it was producing 3.10 million bpd – up by 0.52% from November 2019 and by 15.44% from the previous year.

Like most oil-producing countries, Brazil’s oil exports decreased in recent months, due to the lower global demand. The country holds less than 1% of the world’s oil reserves – enough to last around 15 years.

Iran: 3.19 million bpd

In the 1970s, Iran exerted significant control over the oil industry, producing between 5 million and 6 million barrels of oil per day. As more and more countries started to produce and export oil, this number decreased drastically. Further decreases in production followed as the US imposed and toughened sanctions on Iran.

Changing economic conditions have caused Iran to lower its oil revenue expectations from 29% of GDP in 2019 to just 9% for 2020. However, it remains committed to its investment in oil, with the aim of injecting $500 billion into the sector by 2025.

Kuwait: 2.94 million bpd

Kuwait’s oil (and gas) production is responsible for more than half of its GDP and more than 90% of its exports revenue. The country had plans to boost its production levels to 4 million bpd in 2020, but growth has slowed down due to the global pandemic. Because Kuwait is so dependent on oil production to maintain its economic standing, it may need to find another industry to boost its revenue.

The country’s oil consumption at the end of 2019 was 339,000 barrels per day, down by 33% (from 451,000) in 2018.

How to trade and invest in oil

You can gain exposure to oil by trading or investing. Your choice may depend on your personal preference, your risk appetite and when you want to trade. You can speculate on the price of oil, oil futures and oil options via CFDs, or invest in oil-industry exchange traded funds (ETFs) and stocks.

Trading oil price movements

With IG, you can use derivatives such as spread bets or CFDs to trade oil, without having to own the commodity. One of the benefits of derivatives trading is that it enables you to trade on margin, which means you only need a small percentage of the trade’s value to open your position, but you’d still get exposure to its full value. This can magnify potential profits and any losses.

Get exposure to oil by trading the following:

Spot prices

Oil spot prices represent the cost of buying or selling oil immediately. Trading oil at its spot price means dealing at the current price of the underlying market. This method is popular with short-term traders because spot markets generally offer tighter spreads. However, if you keep your positions open overnight, an additional funding charge will apply.

Learn more about oil trading here


If you want to trade oil at a specific price on a specific date, oil futures may be right for you. Futures are traded on exchanges and reflect the demand for different types of oil. This method is preferred by traders with a longer-term view, as positions can be held without paying overnight funding charges. Oil futures generally have slightly wider spreads, but this is because the overnight funding charge is already included.

Learn more about futures here


An oil option is similar to a futures contract but there’s no obligation to trade if you don’t want to (when buying). With IG, you can trade options using derivatives. There are two types of options: calls and puts. If you thought the market price of oil was going to rise, you might buy a call option. If you thought it was going to fall, you’d buy a put. You can also sell call and put options, if you wanted to take the opposing positions. However, when selling, you will have the obligation to trade at the strike price if the option is executed by the buyer on expiry.

Learn more about options here.

Ready to start trading oil? Open your live account today.


Investing in oil stock means you will own the underlying shares of an oil company, for example BP. You could choose this method if you want to profit from selling shares at a higher price later on. Plus, investing offers other benefits such as dividend payments (if made by the company) and certain shareholder rights.

Learn more about shares trading here.

To start trading or investing in oil, open a live trading account with IG.

Oil industry outlook

The future of the oil industry depends on three major factors: the longer-term repercussions of the Covid-19 pandemic, economic growth in countries such as the US and China, and the outlook for renewable energy sources.

The coronavirus crisis caused a lot of uncertainty in the oil markets and, while there's no way to know for sure what the lasting effects could be, discussions have become increasingly forward-thinking. The economic measures to support the oil industry throughout the crisis may lessen its impact, but the changes will inevitably have a significant effect production and consumption.

Further, the world’s largest economies could suffer big hits to GDP growth due to the shift in oil supply and demand. It remains to be seen how these economies will respond to production cuts, but there will likely be a lasting impact on oil market liquidity and volatility.

Lastly, the US Energy Information Administration (EIA) predicts a decline of traditional energy use in the United States (oil, coal and gas) in the years to come. It has forecast that the use of renewable energy will rise from 17% in 2019 to 21% in 2020, and to 23% in 2021.1 However, the global economy is still very much reliant on oil to function and it remains one of the world’s most valuable resources.

If you’re interested in getting exposure to the oil industry, it’s important to keep an eye on the latest news and ensure you have a good risk management strategy in place.


1 EIA, 2020

Publication date : 2020-07-22T10:38:54+0100

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