EIA outlook sees higher consumption, production

In its July short-term energy outlook, the Energy Information Administration predicts an increase in the global consumption of liquid fuels as well as increased production in the U.S., and overseas.

OPEC crude oil production is expected to increase to 28.7 million barrels per day this year and by 29.3 million barrels per day for 2023. In 2021, OPEC production averaged 26.3 million barrels per day.

Crude oil production in the U.S. is predicted to average 11.9 million barrels per day for 2022, and 12.8 million barrels per day by the end of 2023. This would set a record for the most U.S. crude oil production in a single year.

The current record is 12.3 million barrels per day in 2019.

However, that increased production coincides with a decrease in refining capacity.

“Less refining capacity means the United States will produce less gasoline and diesel fuel this year than in 2019, even though the remaining refineries are pretty much maxing out their production,” Joe DeCarolis, EIA Administrator, said in a news release.

Diesel prices

Even still, EIA expects diesel prices to decline through the remainder of 2022, and into 2023.

The outlook said the average price for a gallon of diesel was $4.91 in the first half of 2022, up from $3.06 in the first half of 2021. By the end of 2022, EIA expects that average to be $4.73 per gallon. For 2023, EIA is predicting diesel to average $4.07 per gallon.

Brent crude oil

The spot price of Brent crude oil averaged $71 per barrel in 2021. In 2022, EIA is predicting that price will average $104 per barrel, and $94 per barrel in 2023.

Global oil inventories increased by 800,000 barrels per day in 2022, said the outlook. No change is expected in that number for 2023.

EIA predicts global consumption of liquid fuels to grow by 2.2 million barrels per day in 2022 and by 2 million barrels per day in 2023.

The complete EIA short-term energy outlook is available here. LL