EIA expects oil prices to increase despite concerns over economic growth and petroleum demand
Published by Poppy Clements,
Assistant Editor
Hydrocarbon Engineering,
Market concerns over economic growth and oil demand have increased, but EIA expects that global oil reserves will begin to decline as OPEC+ production cuts result in global oil consumption exceeding global oil production. OPEC+ member countries announced last week that they will be delaying production increases until December. Those increases were initially set to begin next month.
"We expect that oil prices will be pushed upward in the coming weeks and months as global oil consumption outpaces production," said EIA Administrator, Joe DeCarolis. "There are uncertainties in the market, including demand growth in China and supply disruptions in the Middle East, that could push prices higher or lower in the short term."
Other highlights from the September STEO include:
- Natural gas: EIA expects Henry Hub natural gas prices to remain relatively flat through the rest of 2024 before rising in 2025. EIA forecasts that US production of natural gas will reach nearly 105 billion ft3/d in 2025, surpassing the prior domestic production record set in 2023. Prices increase in EIA’s forecast as US LNG exports rise by more than 2 billion ft3/d in 2025, putting stress on US natural gas storage levels.
- Propane prices: EIA has added a new set of forecasts to STEO: monthly retail propane price forecasts by US region. EIA expects the US average retail propane price for the upcoming heating season to average US$2.50/gal., the same average price as last winter. Regional prices range from an average of about US$2.50/gal. on the East Coast to about US$2.50/gal. in the Midwest this winter, both of which are similar to regional prices last winter.
- Biofuels consumption: EIA has also added several new series of forecasts that better capture how biofuels are being consumed within overall US demand for distillate fuels. EIA expects that although total distillate fuel oil consumption will fall slightly this year to an average of 4.1 million bpd, biofuels will account for 9% of that consumption, up from 8% last year and 5% in 2022.
The full September 2024 STEO is available on the EIA website.
Read the article online at: https://www.hydrocarbonengineering.com/refining/11092024/eia-expects-oil-prices-to-increase-despite-concerns-over-economic-growth-and-petroleum-demand/
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