|
EIA: US production continues to grow
Domestic crude averaged 12.9 million bpd in '23, forecast at 13.2 million in '24, 13.7 million in '25; LNG from 12 bcfpd to 14 bcf
Kristen Nelson Petroleum News
Domestic crude oil production continues to grow, the U.S. Energy Information Administration said in its April Short-Term Energy Outlook, released April 9. In 2023, U.S. crude production averaged 12.9 million barrels per day and is forecast to increase to 13.2 million bpd this year and to 13.7 million bpd in 2025.
Global liquid fuels production is projected to increase by more than 800,000 bpd this year, down from a 1.8 million bpd increase last year, with voluntary production cuts by the Organization of the Petroleum Exporting Countries and associated countries offset by production increases outside of OPEC+ of 1.8 million bpd, increases coming primarily from the United States, Guyana, Brazil and Canada, EIA said.
The agency is forecasting global liquid fuels production to increase by 2 million bpd in 2025, due to a combination of the end of OPEC+ voluntary cuts and supply growth outside of OPEC+.
Brent EIA said the Brent spot oil price, which averaged $82 per barrel last year, is forecast to average $89 per barrel this year before dropping to $87 per barrel in 2025.
Brent averaged $85 per barrel in March, up $2 per barrel over February "and the third consecutive month when the average Brent price increased." The agency is forecasting Brent to average $90 per barrel in the second quarter of this year, up $2 per barrel from its March forecast, reflecting an "expectation of strong global oil inventory draws during this quarter and ongoing geopolitical risks."
EIA attributed increasing oil prices in March to "heightened geopolitical risk related to the attacks targeting commercial ships transiting the Red Sea shipping channel and general elevated tensions around the region," coupled with the extension by OPEC+ of voluntary production cuts at a time when spring and summer driving typically increases demand in the Northern Hemisphere.
Bridge collapse impact The collapse of the Francis Scott Kay Bridge in Maryland March 26 led to a decrease in EIA's forecast for U.S. coal exports, as it closed the Port of Baltimore, the second-largest U.S. hub for coal exports.
"We expect U.S. coal exports to recover toward the end of the summer or early fall, but there is significant uncertainty based on the timeline for the port reopening and how quickly exporters can adjust to export through alternative ports," said EIA Administrator Joe De Carolis.
EIA said it reduced U.S. coal export forecasts for April by 33% and for May by 20%, and after previously expecting U.S. coal exports to increase by some 1% this year, it now expects total coal exports to drop by 6% from 2023 totals.
The agency said Baltimore accounted for 28% of U.S. coal exports last year.
LNG EIA expects U.S. liquefied natural gas exports to average 12 billion cubic feet per day this year, up 2% from 2023. In the agency's overview of U.S. energy market indicators, both 2023 and 2024 show 12 bcf per day of LNG exports.
In 2025, LNG exports are expected to increase by 2 bcf per day, up 18% to 14 bcf per day, as three of five LNG export projects under construction are expected to start operations and ramp up to full production, EIA said.
U.S. LNG export facilities are expected to run at utilization rates similar to last year, "adjusted for seasonality and annual maintenance on liquefaction trans," the agency said. Plaquemines LNG Phase I and Corpus Christi Stage 3 are expected to begin production and load first cargoes by the end of 2024, with the first two of three trains at Golden Pass LNG expected to be in service in 2025.
Domestic gas is also exported by pipeline, with increased exports to Mexico expected to grow pipeline exports by almost 1 bcf per day over the forecast period as several pipeline in Mexico expected to reach full service this year and next.
Natural gas storage EIA estimates that U.S. natural gas storage inventories were 39% higher at the end of the current withdrawal season, November to March, compared to the 2019-23 5-year average.
At the start of the winter heating season storage was 5% above the 5-year average, with that surplus and a mild winter resulting in below-average residential and commercial consumption of natural gas.
Natural gas prices were low in the first quarter of the year, which EIA attributed partly to the large storage surplus.
The Henry Hub spot price averaged less than $2 per million British thermal units in February and March and is forecast to average less than $2 in the second quarter and about $2.20 per million Btu for the year.
Lower U.S. natural gas production is expected in the second and third quarters, compared to the first quarter, EIA said, resulting in less injection into storage than typical. But the agency said it still expects the U.S. to have more than 4,120 bcf of natural gas in storage at the end of the storage season, 10% above the 5-year average and a new record.
| 