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Domestic oil production hits 25-year high Energy Information Administration also says for first time since early 1995, in October the US produced more crude than it imported Kristen Nelson Petroleum News
U.S. crude oil production averaged 7.7 million barrels per day in October, the U.S. Energy Information Administration said in its short-term energy outlook, released Nov. 13.
“As EIA predicted back in March, it appears the United States produced more crude oil in October than it imported for the first time since early 1995,” EIA Administrator Adam Sieminski said in a statement. “Monthly estimated domestic crude oil output averaged 7.7 million barrels per day in October, which was the highest production for any October in 25 years, while oil imports were 7.6 million barrels per day,” he said.
Total petroleum net imports were the lowest since February 1991, the agency said.
EIA is forecasting that U.S. crude oil production will average 7.5 million bpd this year and 8.5 million bpd in 2014.
US crude supply EIA said it expects U.S. crude oil production to increase from a 2012 average of 6.5 million bpd to 7.5 million bpd this year and 8.5 million bpd in 2014. “The continued focus on drilling in tight oil plays in the onshore Bakken, Eagle Ford, and Permian regions is expected to account for the bulk of forecast production growth over the next two years,” the agency said.
Gulf of Mexico production is forecast to average 1.2 million bpd this year and 1.3 million bpd in 2013.
U.S. liquid fuel net imports, including crude oil and petroleum products, peaked at 12.5 million bpd in 2005 and have fallen since.
In October liquid fuel net imports were the lowest since 1991, EIA said, with the share of total U.S. consumption met by imports peaking at more than 60 percent in 2005 and falling to an average of 40 percent in 2012. The agency expects the net import share to decline to 28 percent in 2014, which would be the lowest level since 1985.
Brent down The Brent crude oil spot price fell from a monthly average of $112 per barrel in September to an October average of $109 per barrel, EIA said. The agency expects the Brent crude oil price to continue to weaken as supply from non-OPEC countries exceeds growth in world consumption.
EIA said it expects Brent to average $106 per barrel by December and $103 per barrel next year.
The West Texas Intermediate spot price fell to an average of $101 per barrel in October, down from $106 in September, and EIA said it expects WTI to average $97 per barrel in the fourth quarter and $95 per barrel next year.
“The discount of WTI crude oil spot prices to Brent crude oil has widened from just over $3 a barrel in July to $9 in October, as refinery demand has returned to normal, lower seasonal demand levels, and U.S. crude inventories have begun to grow at the Cushing, Oklahoma, storage hub,” Sieminski said. “EIA forecasts that growing non-OPEC crude production will continue to outpace refinery demand, leading to an average WTI discount to Brent of $10 per barrel in the fourth quarter of 2013 and $8 per barrel in 2014,” he said.
“After averaging nearly $103 per barrel for three consecutive months from April to June, Brent crude oil prices increased to around $110 per barrel from July through October as a result of strong U.S. refinery demand and supply disruptions in the Middle East,” Sieminski said.
Natural gas “EIA boosted its forecast for U.S. marketed natural gas production by 0.4 percent this year and nearly 1 percent for next year, as domestic natural gas output reached record levels during the past several months despite lower gas prices,” Sieminski said. “Gas from the Marcellus Shale has been the main driver of this production growth,” he said.
Natural gas marketed production is projected to increase from 69.2 billion cubic feet per day in 2012 to 70.3 bcf per day this year and 71 bcf per day in 2014, with natural gas pipeline gross imports continuing a five-year fall and liquefied natural gas imports remaining at minimal of levels of some 0.4 bcf per day this year and next.
“This month’s forecast lowers U.S. natural gas imports by pipeline, mostly from Canada, as domestic gas production increases,” Sieminski said.
Natural gas spot prices averaged $3.68 per million Btu at Henry Hub in October, up 6 cents from the September price, EIA said. The agency expects the Henry Hub spot price to increase from an average of $2.75 per million Btu in 2012 to $3.68 this year and $3.84 in 2014.
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