The US Energy Information Administration lowered its oil price forecast in 2023 slightly, and cut its estimates for crude production in the United States during the same year.
The Short-Term Energy Outlook report for July 2023, issued today, Tuesday (July 11), predicted that the average price of West Texas Intermediate crude would reach $74.43 per barrel in 2023, which represents a decline of 0.2% from last June’s expectations. amounting to $74.60 per barrel.
The Energy Information Administration also lowered its estimate for the average price of Brent crude by 0.3%, to be likely to reach $79,534 a barrel in 2023, despite Saudi Arabia extending oil production cuts by one million barrels per day in August, according to the report seen by the Energy Research Unit.
Oil price forecasts in 2024
The Energy Information Administration maintained its forecast for the average price of US crude next year, unchanged at $78.51 per barrel.
It is likely that the price of Brent crude will average $83.51 per barrel over the next year, with little change from last month’s estimates.
Last year (2022), Brent and West Texas Intermediate crude prices averaged $100.94 and $94.91 per barrel, respectively, with the repercussions of the Russian-Ukrainian war.
The Energy Information Administration expects that oil prices (Brent crude) will average $78 per barrel in July.
It is noteworthy that the Energy Information Administration raised oil price expectations by about 13% during the past month, with the decision of the OPEC + alliance – during last June – to install a policy of reducing production by two million barrels per day from November 2022 until the end of 2024.
Also, 9 countries of the coalition, led by Saudi Arabia, decided to extend the additional voluntary supply cut, totaling 1.66 million barrels per day, until the end of 2024. As the following infographic indicates:
In addition, Saudi Arabia approved an additional cut in oil production by one million barrels per day during the month of July, before extending it to next August.
US oil production
The Energy Information Administration cut its estimate for average oil production in America by 0.3% this year, likely to be 12.56 million barrels per day.
Next year, US oil production is expected to average 12.85 million barrels per day, up 0.6% from the previous forecast, according to the report, which was tracked by 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 April 2023:
OPEC production and the world
The Energy Information Administration estimates that average OPEC crude oil production will drop to 28.02 million barrels per day this year, compared to a previous estimate of 28.10 million barrels per day.
OPEC production is expected to rise to 28.49 million barrels per day next year, compared to previous expectations of 28.38 million barrels per day, according to the monthly report.
In contrast, world production of oil and other liquids is likely to reach 101.10 million barrels per day during 2023, down 0.3% from last month’s forecast.
In 2024, the Energy Information Administration expects world production of oil and other liquids to reach 102.27 million barrels per day, down 0.1% from previous estimates.
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