The US Energy Information Administration cut its oil price forecasts for 2023 and 2024 by more than 7%, and cut its estimates for crude production in the United States.
According to the Short-Term Energy Outlook report for May 2023, issued today, Tuesday, May 9, 2023, the average price of West Texas Intermediate crude oil is expected to reach $73.62 per barrel in 2023, down 7.1% from April estimates of $79.24 per barrel. .
The Energy Information Administration also reduced its estimates for the price of Brent crude by 7.5%, to reach $78.65 per barrel during the current year (2023), according to the report, which was seen by the Energy Research Unit.
Oil price forecasts in 2024
The Energy Information Administration cut its estimate for the US crude price in the next year (2024), by 7.6%, to be expected to reach $69.47 per barrel.
Brent crude price is expected to average $74.47 per barrel over the next year, representing a decline of 8.3% compared to last month’s forecast.
Last year (2022), Brent and West Texas Intermediate crude prices averaged $100.94 and $94.91 per barrel, respectively.
And in early April 2023, 9 countries from the OPEC + coalition announced a voluntary cut in oil production, with a total of 1.66 million barrels per day, starting from this May until the end of 2023.
This is in addition to the official production cuts by the coalition of two million barrels per day, which are scheduled from November 2022 until the end of December 2023.
This led to strengthening the expectations of oil prices, especially after Brent crude rose above $85 per barrel on average during April 2023, but prices have retreated around levels of $75 per barrel currently, with fears of an economic recession and risks related to the banking sector.
America’s oil production
The Energy Information Administration cut estimates of oil production in America to 12.53 million barrels per day in 2023, a slight increase of 0.1% from the previous forecast of 12.54 million barrels per day.
Next year, US oil production is likely to average 12.69 million barrels per day, down 0.5% from previous forecasts, according to the Energy Research Unit.
It is estimated that the average oil production in the United States recorded 11.89 million barrels per day during the past year, compared to 11.25 million in the previous year (2021).
The following graphic – prepared by the Energy Research Unit – monitors crude oil production in the United States on a monthly basis from the beginning of 2019 until February 2023:
OPEC production and the world
The Energy Information Administration expects OPEC crude oil production to average 28.34 million barrels per day this year, compared to a previous estimate of 28.26 million barrels per day.
OPEC oil production is likely to rise to 28.99 million barrels per day next year, but it will be lower than the previous estimate of 29.19 million barrels per day.
On the other hand, world production of oil and other liquids is expected to reach 101.34 million barrels per day during the current year, almost unchanged from last month’s forecast.
In 2024, the Energy Information Administration estimates that world production of oil and other liquids will reach 103.02 million barrels per day, down 0.2% from previous expectations.
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