U.S. Crude Production Growth Stalled In April

The Energy Information Administration reported that April crude oil production averaged 10.467 million barrels per day (mmbd), off 2,000 b/d from March’s all-time record high for the U.S. The small but unexpected decline was due to unplanned maintenance in the Gulf of Mexico (GOM), which reduced production there by 98,000 b/d. Otherwise, healthy increases were recorded in North Dakota (61,000 b/d) and Texas + New Mexico (55,000 b/d).

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The EIA-914 Petroleum Supply Monthly (PSM) figure was 115,000 b/d lower than the weekly data reported by EIA in the Weekly Petroleum Supply Report (WPSR), averaged over the month, of 10.582 mmbd. EIA’s most recent weekly estimate for the week ending June 22nd was 10.900 mmbd. Continue reading "U.S. Crude Production Growth Stalled In April"

U.S. March Crude Production Shows Large Gain

Robert Boslego - INO.com Contributor - Energies - U.S. March Crude Production


The Energy Information Administration (EIA) reported that February crude oil production averaged 10.474 million barrels per day (mmbd), up 215,000 b/d from February, setting a new all-time record for the U.S. The large increase was on top of a 264,000 b/d gain in February.

The largest increases were recorded in Texas (159,000 b/d), New Mexico (38,000 b/d) and Oklahoma (15,000 b/d).

U.S. March Crude Production

The EIA-914 Petroleum Supply Monthly (PSM) figure was 54,000 b/d higher than the weekly data reported by EIA in the Weekly Petroleum Supply Report (WPSR), averaged over the month, of 10.420 mmbd. EIA’s most recent weekly estimate for the week ending May 25th was 10.769 mmbd. Continue reading "U.S. March Crude Production Shows Large Gain"

US February Crude Production Shows Big Gain

Robert Boslego - INO.com Contributor - Energies - US February Crude Production


The Energy Information Administration (EIA) reported that February crude oil production averaged 10.264 million barrels per day (mmbd), up 260,000 b/d from January, setting a new all-time record for the U.S. The large increase reflected a gain from a level that was constrained by weather issues.

The largest increases were recorded in Texas (106,000 b/d), the Gulf of Mexico (89,000 b/d) and New Mexico (46,000 b/d).

US February Crude Production

The EIA-914 Petroleum Supply Monthly (PSM) figure was 26,000 b/d lower than the weekly data reported by EIA in the Weekly Petroleum Supply Report (WPSR), averaged over the month, of 10.290 mmbd. EIA’s most recent weekly estimate for the week ending April 20th was 10.586 mmbd. Continue reading "US February Crude Production Shows Big Gain"

Updated 2018 Crude Oil Outlook

Robert Boslego - INO.com Contributor - Energies - Crude Oil Outlook


Analysis prepared on March 19, 2018

The relative rate of growth in supply v. demand will ultimately determine stock levels and prices. And the three key predicting agencies, the International Energy Agency (IEA), Energy Information Administration (EIA), and OPEC have different views on what is likely to unfold.

OPEC does not often predict is own production, but in December it forecast it would average 33.2 million barrels per day (mmbd) during 2018. That would far exceed its projected “call on OPEC oil,” which is world demand minus non-OPEC production. For 2018 as a whole, it predicts that figure will be 33.1 mmbd.

That demand for OPEC oil is based on a gain in demand of 1.52 mmbd and a rise in no-OPEC production of 1.15 mmbd. In my view demand is likely to be a bit stronger due to world economic growth. However, the non-OPEC supply number is much too low, given the recent rise in U.S. production of 886,000 b/d from August through November. (December production was down a bit for seasonal reasons.) Furthermore, U.S. production has yet to respond to $60/b. The rise in output last autumn was a response to $50/b.

The EIA has the most aggressive non-OPEC production estimate of a gain of 2.5 mmbd, with 2.0 occurring in the U.S. alone, and the balance in Canada and Brazil. The EIA forecast is based on a gain in crude production of 1.5 mmbd and a rise in other liquids of 500,000 b/d. WTI did not exceed $60 in any month since 2015 until January 2018. And the year-over-year gain in March 2018 is estimated to be 1.29 mmbd. And so the industry’s response to $60/b could very well enable the 1.5 mmbd gain. Continue reading "Updated 2018 Crude Oil Outlook"

2018: Supply/Demand Trends Can Make Or Break Oil Prices

Robert Boslego - INO.com Contributor - Energies- Crude Oil Price


The crude oil price started the year off strong, as January posted the highest OPEC Reference Basket price ($66.85) since November 2014, the month in which the Saudis decided to wage an oil price war with American shale oil. But the market gave up its 2018 gain during the first week of January, as the Energy Information Administration (EIA) incorporated the huge November production surge into its short-term outlook and weekly time series data. To top it all off, Baker-Hughes reported the most significant one-week gain in its oil-directed drilling rig count.

Whether the market shifts back to bullish sentiment, or whether the bearish sentiment takes control this year, depends mainly on several key assumptions. The central hypothesis is how fast shale oil production will grow this year, and the second is what OPEC production will be, given the on-going risk to Venezuelan output. Based on U.S. production from August through November, the recent lagged response in drilling rigs, and the high prices experienced October through January; I expect that U.S. production will rise faster than either the DOE or OPEC assume in their forecasts.

EIA’s February Outlook

The EIA released its outlook, revising its U.S. crude production estimates much higher. For the year, it now expects crude production to average 10.59 million barrels per day (mmbd) in 2018, and to exit the year at 11.13 mmbd.

The EIA’s estimate of production for February is 10.260 mmbd. That figure is 1.07 mmbd higher than August. If anything, EIA’s 2018 prediction seems low. Continue reading "2018: Supply/Demand Trends Can Make Or Break Oil Prices"