EIA forecasts increase in U.S. crude oil production
The Energy Information Administration expects an increase in daily crude oil production in several regions in 2024.
Most notable is an 8% increase in the Permian Basin, which accounts for nearly half of the country’s crude oil production. That increase would amount to 6.3 million more barrels produced per day in 2024.
The Permian Basin increase along with expected increases in the Appalachia, Bakken, Eagle Ford and Haynesville regions could result in record U.S. oil production, EIA said.
“Consider the natural gas market, where we’ve seen prices decline far more rapidly than production,” EIA Administrator Joe DeCarolis said. We knew that associated natural gas, which is produced as a byproduct of increasing crude oil production, was a driver of relatively stable natural gas production. Now our forecasts clearly show the important regional relationship of oil and natural gas production.”
EIA is forecasting a decrease of around 1% in U.S. marketed natural gas production in response to low natural gas prices. However, increases in natural gas production are still expected in the Permian, Bakken and Eagle Ford regions, EIA added.
Consumption of distillate fuel is expected to increase in the second half of 2024 compared to the second half of 2023. EIA believes an increase in manufacturing will lead to more on-highway trucking and increased consumption.
| Notable Forecast Changes | 2024 | 2025 |
| Brent spot price (current forecast) (dollars per barrel) | $84 | $85 |
| Previous forecast | $88 | $85 |
| Percentage change | -4.1% | 0.0% |
| Retail diesel price (current forecast) (dollars per gallon) | $3.90 | $4.00 |
| Previous forecast | $4.00 | $4.20 |
| Percentage change | -2.9% | -3.9% |
| Henry Hub spot price (current forecast) (dollars per million British thermal units) | $2.50 | $3.20 |
| Previous forecast | $2.20 | $3.10 |
| Percentage change | 12.8% | 5.1% |
| Natural gas inventories (current forecast) (billion cubic feet) | 3,340 | 3,260 |
| Previous forecast | 3,520 | 3,410 |
| Percentage change | -5.2% | -4.5% |
Note: Values in this table are rounded and may not match values in other tables in this report.
The current STEO forecast was released June 11.
The previous STEO forecast was released May 7.
International production
The expectation is that OPEC+ will begin relaxing voluntary cuts in the fourth quarter of 2024. It was previously forecast this would take place in the third quarter. This delay will cause global oil inventories to continue to decline through the first quarter of 2025, EIA said.
Read the full June EIA short-term outlook here.
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