Foreign news on June 6, the US Energy Information Administration (EIA) announced on Tuesday that compared to previous expectations, US crude oil production will grow faster this year, while demand growth will slow down.
The EIA released a new oil market outlook, after the Organization of the Petroleum Exporting Countries (OPEC) and its allies announced to extend the production reduction agreement to 2024. Saudi Arabia has stated that it will voluntarily reduce production by 1 million barrels per day in July to stabilize the oil market.
The EIA predicts in its short-term energy outlook that OPEC's production reduction will slightly reduce global oil inventories in each of the next five quarters, and will boost global oil prices by the end of 2023 and early 2024.
EIA predicts that Brent crude oil prices will average $79.54 per barrel in 2023, approximately 1% higher than previous forecasts. The average price of West Texas Intermediate (WTI) in the United States in 2023 is expected to be $74.60 per barrel, which is 1.3% higher than previous forecasts.
The EIA predicts that the total oil consumption in the United States will only increase by 100000 barrels per day in 2023, to 20.4 million barrels per day, after predicting an increase of 200000 barrels per day in May.
The EIA said that although the service industry and tourism industry should boost the demand for gasoline and aviation fuel this year, diesel consumption is bound to decline as the role of manufacturing in the economy weakens.
The EIA predicts that US crude oil production will climb by 720000 barrels per day this year to 12.61 million barrels per day, higher than the previous forecast of an increase of 640000 barrels per day.
Due to investors demanding increased dividend payouts and stock repurchases rather than capital expenditures, the growth of US oil production has slowed down. But US production is still expected to set annual production records in 2023 and 2024.
