The amount of oil produced in the U.S., now at a 21 year high, is nearly even with the amount being imported, and the gap is narrowing.

The impact of rising U.S. oil production is also showing up rather dramatically in the futures market, where the price spread between higher priced international crude, or Brent, and domestic West Texas Intermediate is also narrowing. The spread was below $7.72 per barrel Wednesday, at its lowest level since December, 2011. West Texas Intermediate settled at $96.62 per barrel, up $1. Brent finished the day six cents lower at $104.34 per barrel. The spread between the two was more than $20 in February.

"I think we could go to parity by the end of the year. The logistics and the refiguring of the supply distribution system is really remarkable. By the end of the year, on top of all the pipeline efforts, we're going to have about 1.2 million barrels of oil riding the rails," said John Kilduff of Again Capital.

U.S. crude had been landlocked in the center of the country with insufficient pipelines to transport it. But the Seaway pipeline has since been reversed and other progress has been made, including train transport, allowing more oil to get to refineries.

"It seems to have happened in March, and it will keep happening before it becomes permanent. It could happen again in September, October, November," he said. Lipow said he expects the government will report that domestic crude production reached about 7.15 million barrels per day in March, while imports fell to 6.95 million barrels.

The Energy Information Administration said Wednesday in its Short-Term Outlook that U.S. oil production averaged 7.1 million barrels per day in the first quarter, and that should rise to 8.5 million barrels per day by the fourth quarter of 2014.

It expects average production of 7.4 million barrels per day in 2013, up from 6.5 million barrels per day in 2012. EIA also said it expects liquid fuel net imports, including crude and petroleum products to keep falling, from 7.4 million barrels per day in 2012 to 5.7 million barrels per day by 2014.

The EIA also said it increased its short-term outlook for U.S. lower 48 state onshore oil production because of continued success in some major plays in the Permian Basin.

The EIA, in its weekly report, said refinery utilization rose to 87 percent, as more refineries came back on line from maintenance. U.S. oil stocks fell by 652,000 barrels to 49.15 million in the latest week.

"We are processing about 400,000 barrels per day more crude than this time last year and about 1 million barrels per day more than two years ago," Lipow said.

Note: This blog is just an expression of the author's opinion and cannot be deemed responsible for any losses incurred.