The US Energy Information Administration raised expectations for crude oil prices by about 13% during the next year (2024), and also strengthened its estimates for the year 2023, after the OPEC + alliance decided to stabilize the supply reduction policy, with an adjustment to the base month through which the production quotas of members in the alliance are calculated starting From next year (2024).
According to the Short-Term Energy Outlook report for June 2023, issued today, Tuesday, June 6, it is expected that the average price of West Texas Intermediate crude oil will reach the level of $ 74.60 per barrel during 2023, an increase of 1.3% over expectations for last May of $ 73.62. per barrel.
The Energy Information Administration also boosted its estimate for the price of Brent crude by 1.1%, to reach $79.54 a barrel this year, according to the report seen by the Energy Research Unit.
Oil price forecasts in 2024
The Energy Information Administration expects the US crude price to average $78.51 per barrel next year, an upward revision of 13% from last month’s estimate of $69.71 per barrel.
Brent crude price is likely to average $83.51 per barrel over the next year, up 12.1% from last month’s forecast of $74.47, with expectations that lower inventories will lead to upward pressure on prices.
Last year (2022), Brent and West Texas Intermediate crude prices averaged $100.94 and $94.91 per barrel, respectively.
This comes after the OPEC + coalition announced, at its meeting on June 4, 2023, the stabilization of the production cut policy, which entered into force from November 2022 until the end of 2023, by two million barrels per day, with an adjustment to the target production levels for the year 2024 at 40.46 million barrels. Daily.
The following chart – prepared by the Energy Research Unit – monitors oil production shares for OPEC + countries in 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 next year, after it was previously scheduled to end at the end of December 2023.
In addition, Saudi Arabia decided to reduce oil production by one million barrels per day during the month of July, in addition to extending the additional voluntary cut by 500,000 barrels per day until the end of 2024.
America’s oil production
The Energy Information Administration raised its estimate for average oil production in the United States to 12.61 million barrels per day in 2023, up 0.6% from the previous forecast of 12.53 million barrels per day.
Next year, US oil production is expected to average 12.77 million barrels per day, up 0.7% from the previous forecast, according to the Energy Research Unit.
It is estimated that the average oil production in the United States reached 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 March 2023:
OPEC production and the world
The Energy Information Administration estimates that OPEC’s crude oil production will average 28.10 million barrels per day this year, compared to a previous estimate of 28.34 million barrels per day.
OPEC oil production is expected to drop to 28.38 million barrels per day next year, lower than the previous estimate of 28.99 million barrels per day.
On the other hand, world production of oil and other liquids is likely to reach 101.37 million barrels per day this year, almost unchanged from last month’s forecast.
In 2024, the Energy Information Administration expects world production of oil and other liquids to reach 102.69 million barrels per day, down 0.3% from the previous forecast.
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