The U.S. Energy Information Administration (EIA) forecasts total global liquid fuels inventories to decrease by 0.2 million b/d in 2018 compared with 2017, followed by an increase of 0.3 million b/d in 2019. This outlook of relatively stable inventory levels over the forecast period contributes to a forecast of monthly average Brent crude oil prices remaining relatively stable between $70/b and $73/b, from August 2018 through the end of 2019. EIA estimates that U.S. crude oil production averaged 10.8 million barrels per day (b/d) in July, up 47,000 b/d from June.
“Because crude oil production is forecast to be lower in 2018, it lowered the overall output forecast for 2019,” said Tim Hess, a product manager for the EIA’s Short-Term Energy Outlook. “The lower forecast for output this year reflects slightly slower than expected growth in middle quarters of this year, possibly related to pipeline constraints out of the Permian basin that have reduced wellhead prices in the region.”