U.S. crude oil production is expected to fall by 800,000 bbl/d this year to 11.45 million bbl/d, the U.S. Energy Information Administration (EIA) said on Oct. 6, a smaller decline than its previous monthly forecast for a drop of 870,000 bbl/d.
The agency estimated that production rose to 11.2 million bbl/d in September and said it expects output to generally decline to an average of 11 million bbl/d in the second quarter of 2021 because new drilling activity will not generate enough production to offset declines from existing wells.
U.S. energy firms last week added oil and natural gas rigs for a third week in a row for the first time since October 2018 after price increases in recent months prompted some producers to start drilling again.
However, signs of a renewed wave of COVID-19 infections around the world have dented the outlook for demand.
The EIA forecasts that global consumption of petroleum and liquid fuels will average 92.8 million bbl/d for all of 2020, down by 8.6 million bbl/d from 2019, before increasing by 6.3 million bbl/d in 2021.
The agency now expects U.S. petroleum and other liquid fuel consumption to decline 2.31 million bbl/d to 18.23 million bbl/d in 2020, a slightly bigger decline than its previous forecast for a drop of 2.12 million bbl/d.
For 2021, U.S. demand is expected to rise 1.74 million bbl/d to 19.97 million bbl/d compared with a previous forecast for a rise of 1.64 million bbl/d.
U.S. crude output is expected to fall 360,000 bpd to 11.09 million bbl/d in 2021, compared with a previous estimate of a decline of 300,000 bbl/d.
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