2017-04-12 18:50:00
OIL PRICES FORECAST: $54 - $57
EIA - SHORT-TERM ENERGY OUTLOOK
Forecast Highlights
U.S. crude oil production averaged an estimated 8.9 million barrels per day (b/d) in 2016. U.S crude oil production is forecast to average 9.2 million b/d in 2017 and 9.9 million b/d in 2018.
North Sea Brent crude oil spot prices averaged $52 per barrel (b) in March, $3/b lower than the February average. EIA forecasts Brent prices to average $54/b in 2017 and $57/b in 2018. West Texas Intermediate (WTI) crude oil prices are forecast to average $2/b less than Brent prices in both 2017 and 2018.
NYMEX contract values for July 2017 delivery traded during the five-day period ending April 6 suggest that a range of $41/b to $66/b encompasses the market expectation for WTI prices in July 2017 at the 95% confidence level.
U.S. dry natural gas production is forecast to average 73.1 billion cubic feet per day (Bcf/d) in 2017, a 0.8 Bcf/d increase from the 2016 level. This increase reverses a 2016 production decline, which was the first annual decline since 2005. Natural gas production in 2018 is forecast to be 4.0 Bcf/d above the 2017 level.
In March, the average Henry Hub natural gas spot price was $2.88 per million British thermal units (MMBtu), 3 cents/MMBtu above the February level. Prices increased as temperatures in March returned to more seasonally typical levels after being significantly warmer than normal in February.
New natural gas export capabilities and growing domestic natural gas consumption contribute to the forecast Henry Hub natural gas spot price rising from an average of $3.10/MMBtu in 2017 to $3.45/MMBtu in 2018. NYMEX contract values for July 2017 delivery traded during the five-day period ending April 6 suggest that a range of $2.49/MMBtu to $4.59/MMBtu encompasses the market expectation for Henry Hub natural gas prices in July 2017 at the 95% confidence level.
Prices
North Sea Brent crude oil spot prices averaged $52 per barrel (b) in March, $3/b lower than the February average. EIA forecasts Brent prices to average $54/b in 2017 and $57/b in 2018. West Texas Intermediate (WTI) crude oil prices are forecast to average $2/b less than Brent prices in both 2017 and 2018.
NYMEX contract values for July 2017 delivery traded during the five-day period ending April 6 suggest that a range of $41/b to $66/b encompasses the market expectation for WTI prices in July 2017 at the 95% confidence level.
In March, the average Henry Hub natural gas spot price was $2.88 per million British thermal units (MMBtu), 3 cents/MMBtu above the February level. Prices increased as temperatures in March returned to more seasonally typical levels after being significantly warmer than normal in February.
Crude Oil
EIA expects world crude oil and liquid fuels supply to grow by 1.1 million barrels per day (b/d) in 2017 and by 1.9 million b/d in 2018. Compared with the previous forecast, these growth estimates are higher by about by 0.1 million b/d and 0.2 million b/d, respectively, because of higher expected U.S. and Brazilian crude oil production growth. Expected world liquid fuels consumption growth is mostly unchanged from the previous forecast at 1.5 million b/d in 2017 and 1.6 million b/d in 2018. EIA expects the market to be relatively balanced in 2017 and forecasts the Brent crude oil spot price to average $54/b in 2017 and $57/b in 2018.
U.S. crude oil production was an estimated 9.1 million b/d in March, the highest level in a year. Production is forecast to grow by an average of 0.3 million b/d in 2017 and by 0.7 million b/d 2018.
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