Burke – The U.S. crude oil production is expected to decline from June through September before assuming growth, according to the latest data from the Energy Information Administration.
Total production averaged an estimated 9.3 million barrels per day (b/d) in March, says the data released on May 12. Given EIA’s price forecast, projected total crude oil production averages 9.2 million b/d in both 2015 and 2016, 40,000 b/d and 100,000 b/d lower than in last month’s short-term energy outlook.
As per weekly data, U.S. crude oil inventories fell last week by 2.18 million barrels in the week ended on May 8. Crude oil refinery inputs averaged 16.0 million barrels per day during the week in review, 379,000 barrels per day less than the previous week’s average.
Gasoline production increased last week, averaging 9.7 million barrels per day. Distillate fuel production decreased last week, averaging 4.9 million barrels per day.
While U.S. monthly average regular gasoline retail prices in April remained almost unchanged from March at $2.47 gallon, U.S. weekly regular gasoline retail prices reached an average of $2.69 gallon on May 11, according to the latest STEO outlook.
EIA expects U.S. regular gasoline retail prices, which averaged $3.36/gal in 2014, to average $2.43/gal in 2015 and 2.63/gal in 2016. The average household is expected to spend $675 less for gasoline in 2015 compared with last year because of lower prices.
North Sea Brent crude oil prices are forecast to average $61/b in 2015 and $70/b in 2016. Brent crude oil prices averaged $60/b in April, a $4/b increase from March and the highest monthly average of 2015, the report says.
Despite increasing global inventories, several factors contributed to higher prices in April, including indications of higher global oil demand growth, expectations for declining U.S. tight oil production in the coming months, and the growing risk of unplanned supply outages in the Middle East and North Africa.
Average West Texas Intermediate (WTI) prices in 2015 and 2016 are expected to be $6/b and $5/b below Brent, respectively.