U.S. oil production to fall, EIA says
YEREVAN, September 10. / ARKA /. Government forecasters on Wednesday said U.S. oil production fell to a nearly one-year low and that low crude prices are likely to keep U.S. production falling through 2016.
The Wall Street Journal reports that the U.S. Energy Information Administration (EIA), in its monthly short-term energy outlook, said that production fell by 140,000 barrels a day in August from the prior month. Production averaged 9.6 million barrels a day at its peak in April, the highest level since 1971, and has steadily declined since then to 9.1 million, the lowest since September.
Oil traders have been closely focused on U.S. production in recent months, after a global glut of crude oil sent prices plunging in 2014. With the Organization of the Petroleum Exporting Countries producing above its target of 30 million barrels a day, investors say U.S. production needs to fall to make the market less oversupplied.
The agency has pushed back its expectations for a U.S. production recovery by about six months, saying monthly production will keep falling until it hits 8.6 million barrels a month until August 2016. It lowered its output expectations for both 2015 and 2016 by about 1.5%, to 9.2 million barrels a day this year and 8.8 million barrels a day next year.
“Current low oil prices are making some U.S. oil production less profitable,” EIA Administrator Adam Sieminski said in a statement.
It also cut its price forecast for both U.S. and global crude benchmarks through next year. The agency said U.S. crude would average $53.57 a barrel in 2016, down 1.6% from its previous forecast. The U.S. price averaged $93.17 a barrel in 2014.
Brent will average just $58.57 a barrel in 2016, EIA said, trimming 1.4% from the previous forecast. In 2014 Brent averaged $98.89 a barrel. -0-
The Wall Street Journal reports that the U.S. Energy Information Administration (EIA), in its monthly short-term energy outlook, said that production fell by 140,000 barrels a day in August from the prior month. Production averaged 9.6 million barrels a day at its peak in April, the highest level since 1971, and has steadily declined since then to 9.1 million, the lowest since September.
Oil traders have been closely focused on U.S. production in recent months, after a global glut of crude oil sent prices plunging in 2014. With the Organization of the Petroleum Exporting Countries producing above its target of 30 million barrels a day, investors say U.S. production needs to fall to make the market less oversupplied.
The agency has pushed back its expectations for a U.S. production recovery by about six months, saying monthly production will keep falling until it hits 8.6 million barrels a month until August 2016. It lowered its output expectations for both 2015 and 2016 by about 1.5%, to 9.2 million barrels a day this year and 8.8 million barrels a day next year.
“Current low oil prices are making some U.S. oil production less profitable,” EIA Administrator Adam Sieminski said in a statement.
It also cut its price forecast for both U.S. and global crude benchmarks through next year. The agency said U.S. crude would average $53.57 a barrel in 2016, down 1.6% from its previous forecast. The U.S. price averaged $93.17 a barrel in 2014.
Brent will average just $58.57 a barrel in 2016, EIA said, trimming 1.4% from the previous forecast. In 2014 Brent averaged $98.89 a barrel. -0-