US oil production would remain relatively stable through 2021, according to projections from the Energy Information Administration (EIA) included in its Short-Term Energy Outlook.
The United States produced a record 12.9 million barrels per day (b/d) of crude oil in November 2019 and was 12.7 million b/d in March 2020, when the president declared a national emergency over the Covid outbreak. -19.
Crude oil production then fell to 10.0 million b/d in May 2020, the lowest level since January 2018.
By August, the latest monthly data available in the EIA series, crude oil production had risen to 10.6 million b / d in the United States, and the US benchmark price for West Texas Intermediate crude oil (WTI) had increased from a monthly average of $ 17 per barrel (b) in April to $ 42 per barrel in August.
The EIA forecasts that the price of WTI will average $ 43/b in the first half of 2021, above our forecast of $ 40/b during the second half of 2020.
The US oil production forecast reflects the EIA’s expectations that annual global oil demand will not recover to pre-pandemic levels (101.5 million b/d in 2019) until at least 2021.
The EIA forecasts that global oil consumption will average 92.9 million b/d in 2020 and 98.8 million b/d in 2021.
The gradual recovery in global oil demand contributes to the EIA’s forecast of higher crude oil prices in 2021.
The EIA expects the price of Brent crude oil to rise from its 2020 average of 41/b to 47/b in 2021.
The EIA crude oil price forecast depends on many factors, especially changes in global crude oil production.
In early November, members of the Organization of the Petroleum Exporting Countries (OPEC) and partner countries (OPEC +) were considering plans to keep production at current levels, which could result in higher crude prices.
OPEC + had previously planned to ease production cuts in January 2021.
Other factors could result in lower-than-anticipated prices, especially a slower recovery in global oil demand.