OIL PRICES: $51 - $52, GAS PRICES: $3.05 - $3.29
EIA - SHORT-TERM ENERGY OUTLOOK
North Sea Brent crude oil spot prices averaged $52 per barrel (b) in August. EIA forecasts Brent spot prices to average $51/b in 2017 and $52/b in 2018. West Texas Intermediate (WTI) average crude oil prices are forecast to be about $2/b lower than Brent prices in both 2017 and 2018. NYMEX contract values for December 2017 delivery that traded during the five-day period ending September 7 suggest that a range of $39/b to $63/b encompasses the market expectation for December WTI prices at the 95% confidence level.
In August, the average Henry Hub natural gas spot price was $2.90 per million British thermal units (MMBtu), down 8 cents/MMBtu from the July level. Expected growth in natural gas exports and domestic natural gas consumption in 2018 contribute to the forecast Henry Hub natural gas spot price rising from an annual average of $3.05/MMBtu in 2017 to $3.29/MMBtu in 2018. NYMEX contract values for December 2017 delivery that traded during the five-day period ending September 7 suggest that a range of $2.39/MMBtu to $4.34/MMBtu encompasses the market expectation for December Henry Hub natural gas prices at the 95% confidence level.
U.S. crude oil production is estimated to have averaged 9.2 million b/d in August, down about 40,000 b/d from the July average. Crude oil production in the Gulf of Mexico fell to a monthly average of 1.6 million b/d in August, down by 70,000 b/d from the July level. At the time of publication, many oil production platforms in the Gulf of Mexico had returned to operation, and EIA forecasts overall U.S. crude oil production will continue to grow in the coming months. EIA forecasts total U.S. crude oil production to average 9.3 million b/d for all of 2017 and 9.8 million b/d in 2018, which would mark the highest annual average production in U.S. history, surpassing the previous record of 9.6 million b/d set in 1970.
U.S. dry natural gas production is forecast to average 73.7 billion cubic feet per day (Bcf/d) in 2017, a 1.4 Bcf/d increase from the 2016 level. Natural gas production in 2018 is forecast to be 4.4 Bcf/d higher than the 2017 level.
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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.