© Reuters. An oil pump in Texas, USA, in this photo from Reuters archive.
From Laura Sannicola
(Reuters) – The US Energy Information Administration cut its forecast for US production for 2023 by about 50,000 barrels per day, after the Organization of the Petroleum Exporting Countries (OPEC) and its allies extended production cuts to 2024.
The administration said in its short-term energy outlook that crude oil production is expected to rise by 670 thousand barrels per day to 12.56 million this year, which is less than the previous forecast, which indicated an increase of about 720 thousand.
The administration has previously stated that the OPEC+ production cut is expected to reduce global oil inventories in each of the next five quarters and boost global oil prices in late 2023 and early 2024.
The EIA now expects spot Brent crude prices to average $78 a barrel in July, with crude oil prices reaching $80 a barrel in the fourth quarter of 2023.
The latest rise in Brent crude futures prices was 2 percent to 79.34 a barrel on Tuesday.
The administration said the oil market will continue to be tight in the second half of 2023, citing strong demand from China and developing countries as well as recently announced supply cuts and Russia, two of the world’s largest exporters.
At the same time, the demand for oil in the United States and the world is expected to increase.
OPEC Secretary-General Haitham Al-Ghais said on Tuesday that global demand for all forms of energy is expected to rise by 23 percent until 2045.
The Energy Information Administration expects total US oil consumption, which is an indicator of demand, to rise by about 100,000 barrels per day to 20.4 million this year, and another 400,000 to 20.8 million in 2024.
The department publishes new forecasts this week.
The administration said on Tuesday that the United States is expected to use a record high amount of electricity generation in July and August as rising temperatures drive demand for air conditioning. The administration expects U.S. electricity generation from natural gas to increase by 4 percent in July and August 2023 from a year earlier.
(Prepared by Muhammad Harfoush for the Arabic Bulletin – Edited by Ali Khafaji)
2023-07-12 01:11:00
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