(Bloomberg) — The US expects domestic oil production to flatline for most of this year before reaching a new record in early 2025.
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The pullback follows a year of surprising US output growth that dampened the impact of production cuts by OPEC and its allies. If the forecast holds, US output will recede modestly during the first quater just as OPEC+ exports fall back — potentially supporting crude prices that are down more than 20% from last year’s highs.
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Shut-ins from frigid weather caused US output to drop to 12.6 million barrels a day in January from a record 13.3 million-barrel clip in December, the EIA said in a forecast Tuesday. Production will rebound to just shy of record levels this month before decreasing slightly for the rest of the year, and won’t reach a new high until next February, the agency said.
The EIA continues to expect a global supply deficit of about 120,000 barrels a day in 2024. But that forecast stands in contrast to that of the International Energy Agency, which sees continued supply growth from the US, Canada, Brazil and Guyana contributing to a global surplus of 500,000 barrels a day.
The EIA lowered its forecast for US oil demand this year to 20.39 million barrels a day, down from a previous estimate of 20.45 million barrels a day. The forecast for US jet fuel demand was revised lower by about 1.8% to 1.68 million barrels a day.
(Updates headline and adjusts lede.)
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