January 15, 2025 [Oil Price]- Crude oil prices remained stable today after dipping on Tuesday following the release of the Energy Information Administration’s latest Short-Term Energy Outlook.
In the outlook, the EIA predicted weaker oil prices this year and next, citing expectations that OPEC will roll back its production cuts and non-OPEC oil producers will continue raising their output at intensive rates.
As a result, Brent crude and West Texas Intermediate dipped on Tuesday, only to rebound later, with Brent crude returning above $80 per barrel and WTI inching closer to $79 per barrel. At the time of writing, Brent was trading at $80.17 per barrel, with WTI at $77.88 per barrel.
In its Short-Term Energy Outlook, the EIA said it expected global oil production to add 1.8 million barrels daily this year and another 1.5 million barrels daily in 2026. In the United States, the EIA expects only a modest increase in oil production, from 13.2 million bpd last year to 13.5 million bpd, inching further up even more slowly in 2026, to 13.6 million barrels daily.
The Permian will continued to be the driver of U.S. oil production growth, coming to account for more than half of the national total next year. In other plays, however, production is set to begin declining, the EIA said.
Consumption, however, is set to underwhelm, according to the EIA, with growth this year seen at 1.3 million barrels daily, or 200,000 bpd lower than projected production growth. This rate of growth will slow down further next year, the EIA predicted, to just 1.1 million bpd, led by Asia and specifically India.
Not everyone is this gloomy on oil, however. For starters, the EIA itself noted that its forecast was compiled before the federal government slapped the latest sanctions on the Russian oil industry. These sanctions are widely seen as potentially curbing Russian oil exports, and as a result boosting prices by eliminating any surplus supply 0n the global market.
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