EIA: BRENT OIL: $102/BBL IN 2015
EIA projects average U.S. household expenditures for natural gas, heating oil, electricity, and propane will decrease this winter heating season (October 1 through March 31) compared with last winter, which was 11% colder than the previous 10-year average nationally. Projected average household expenditures for propane and heating oil are 27% and 15% lower, respectively, because of lower heating demand and prices. Lower heating demand and higher prices contribute to natural gas and electricity expenditures that are 5% and 2% lower than last winter.
Driven in large part by falling crude oil prices, U.S. regular gasoline retail prices fell to an average of $3.41/gallon (gal) in September, 29 cents below the June average. U.S. regular gasoline retail prices are projected to continue to decline to an average of $3.14/gal in December. EIA expects U.S. regular gasoline retail prices, which averaged $3.51/gal in 2013, to average $3.45/gal in 2014 and $3.38/gal in 2015.
Weakening global demand helped North Sea Brent crude oil spot prices fall to an average of $97 per barrel (bbl) in September, the first month Brent prices have averaged below $100/bbl in more than two years. EIA projects that Brent crude oil prices will average $98/bbl in fourth-quarter 2014 and $102/bbl in 2015. The WTI discount to Brent, which averaged $11/bbl in 2013, is expected to average $7/bbl in both 2014 and 2015.
Total U.S. crude oil production averaged an estimated 8.7 million barrels per day (bbl/d) in September, the highest monthly production since July 1986. Total crude oil production, which averaged 7.4 million bbl/d in 2013, is expected to average 9.5 million bbl/d in 2015. If realized, the 2015 forecast would be the highest annual average crude oil production since 1970. Natural gas plant liquids production is expected to increase from an average of 2.6 million bbl/d in 2013 to 3.2 million bbl/d in 2015.
Natural gas working inventories on September 26 totaled 3.10 trillion cubic feet (Tcf), 0.37 Tcf (11%) below the level at the same time a year ago and 0.40 Tcf (11%) below the previous five-year average (2009-13). Projected natural gas working inventories reach 3.53 Tcf at the end of October, 0.28 Tcf below the level at the same time last year. Despite the lower stocks at the start of this winter's heating season, EIA expects the Henry Hub natural gas spot price to $4.00/million British thermal units (MMBtu) this winter compared with $4.53/MMBtu last winter. This price forecast reflects both lower expected heating demand and significantly higher natural gas production this winter.
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AN - China National Offshore Oil Corp. (CNOOC) is willing to invest $3 billion in its existing oil and gas operation in Nigeria, the Nigerian National Petroleum Corporation (NNPC) said on Sunday following a meeting with the Chinese in Abuja.
REUTERS - Production at Libya’s giant Sharara oil field was expected to fall by at least 160,000 barrels per day (bpd) on Saturday after two staff were abducted in an attack by an unknown group, the National Oil Corporation (NOC) said.
IMF - Output grew by 3.8 percent in 2017, underpinned by a resilient non-hydrocarbon sector, with robust implementation of GCC-funded projects as well as strong activity in the financial, hospitality, and education sectors. The banking system remains stable with large capital buffers. Growth is projected to decelerate over the medium term.
IMF - Higher oil prices and short-term portfolio inflows have provided relief from external and fiscal pressures but the recovery remains challenging. Inflation declined to its lowest level in more than two years. Real GDP expanded by 2 percent in the first quarter of 2018 compared to the first quarter of last year. However, activity in the non-oil non-agricultural sector remains weak as lower purchasing power weighs on consumer demand and as credit risk continues to limit bank lending.