US EIA Forecasts Stronger Oil Production Growth in 2024

Tuesday, 12 March 2024, 17:43

The latest report from the US Energy Information Administration (EIA) projects a significant increase in crude oil production for 2024. Despite some concerns about US shale discipline, the forecast indicates a rise of 260k bpd, marking a notable uptick from the previous estimates. This growth, coupled with ongoing global market dynamics, may intensify competition for market share and impact pricing strategies in the oil industry. The article delves into the details of the EIA's projections, highlighting key factors driving the anticipated production surge.

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US EIA Forecasts Stronger Oil Production Growth in 2024

Everyone in the oil market wants discipline in US shale but at $78/barrel there is still plenty of money to be made that is keeping the taps running. The EIA now sees US crude production up 260k bpd in 2024 compared to a rise of 170k bpd in the previous forecast. That 90k increase isn't particularly meaningful in a global context but it's another headache for oil.

To be sure, the pace of US production growth is slowing and the shale treadmill is relentless but I don't see any signs of a cliff. US production will be 13.19 million barrels per day this year, the EIA predicts. That's the most any country has ever produced but they now forecast it will rise to 13.65 mbpd in 2025.

Another 460k bpd next year combined, Canada, Guyana and capacity growth in the UAE may set the table for a battle for market share.

The US demand forecast for 2024 was unchanged but in 2025 it was bumped up by 100,000 bpd.

Meanwhile, sub-$2 natural gas finally made gas producers cut drilling with production at 103.35 bcfd, down from 104.37 bcfd forecast in February.

WTI crude was last trading flat on the day.

This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.