EIA raises 2015 US crude output to 9.3mn b/d
OREANDA-NEWS. November 12, 2015. The Energy Information Administration (EIA) revised its 2015 estimate for US crude production up by about 40,000 b/d to 9.3mn b/d.
The estimate for 2016 was down by 90,000 b/d to about 8.8mn b/d, the EIA said in its Short-Term Energy Outlook (Steo).
US crude output in October dropped by 40,000 b/d from September and is expected to decline through the third quarter of 2016 before growth resumes, the EIA said.
The lower output from the US in 2016 will lead to an overall decline in production from non-OPEC countries for first time since 2008, said EIA administrator Adam Sieminski.
The EIA expects Brent crude prices to average \\$54/bl in 2015, unchanged from last month's Steo. The EIA lowered its Brent price forecast for 2016 by \\$2/bl to \\$56/bl
WTI in 2015 is expected to average \\$4/bl less than the Brent price, at \\$50/bl. In 2016, WTI should average \\$51/bl.
The EIA said that its crude price forecast remains subject to "significant uncertainties" as the oil market moves toward balance.
"During this period of price discovery, oil prices could continue to experience periods of heightened volatility," the agency said.
The oil market faces many uncertainties heading into 2016, including the pace and volume at which Iranian oil re-enters the market, the strength of crude consumption growth, and the responsiveness of non-Opec production to low prices.
Global oil inventory builds in the third quarter averaged 1.6mn b/d, down from 2mn b/d in the second quarter. The second quarter increase had marked the highest level of inventory builds since 2008. The pace of inventory builds is expected to slow further in the fourth quarter to 1.2mn b/d.
Meanwhile, monthly data show that US gasoline consumption increased by 2.7pc during the first eight months of 2015 compared with same period in 2014.
The growth reflects strong increases in employment and lower gasoline prices.
"US gasoline demand this year is on track to be the highest since record levels were set in 2007, due in large part to low pump prices and more people working" Sieminski said.
The EIA yesterday reported that crude output in major US shale basins will fall by 118,000 b/d to 4.95mn b/d from November to December.
Production is expected to drop in the Bakken in North Dakota, the Eagle Ford in Texas and the Niobrara, spread across Colorado, Kansas, Nebraska and Wyoming. Output in the top-producing Permian basin in Texas should rise, the EIA said in its latest Drilling Productivity Report.