Global and U.S. oil production are expected to reach slightly higher record levels than previously predicted this year, according to the U.S. Energy Information Administration (EIA). Despite this surge in supply, weakening demand has led to a significant drop in oil prices, which have fallen to their lowest levels since 2021, even as the Organization of the Petroleum Exporting Countries (OPEC) and its allies in OPEC+ have implemented significant production cuts.
The EIA now forecasts U.S. oil production will average 13.23 million barrels per day (bpd) in 2024, a 300,000 bpd increase over last year’s record of 12.93 million bpd. This figure slightly exceeds the agency’s previous prediction of 13.22 million bpd.
Looking ahead, U.S. oil output is projected to grow further, reaching 13.53 million bpd in 2025, although this marks a slight downward revision from the earlier forecast of 13.54 million bpd.
On the global stage, the EIA raised its oil production forecast for 2024 to 102.6 million bpd, up from 102.5 million bpd in the prior estimate. For 2025, global production is expected to increase to 104.7 million bpd, a modest uptick from the previous forecast of 104.5 million bpd.
The demand outlook for oil has been a point of contention among major industry forecasters, with disagreements largely centered around China’s consumption patterns and the speed of the global transition to renewable energy. The EIA now anticipates global oil demand will rise by approximately 1 million bpd in 2024, a slight increase from the previous forecast of 900,000 bpd.
In contrast, OPEC lowered its 2024 demand forecast for the fourth consecutive month but still expects growth of 1.82 million bpd. The International Energy Agency (IEA), based in Paris, predicts a more modest increase of 860,000 bpd.
Despite the mixed outlook for demand, OPEC+ production cuts are expected to support a rise in global oil prices, particularly during the first quarter of 2024, according to the EIA.
Related topic:
What Time Is Eia Natural Gas Report?
U.S. Seeks Methane Regulation Alignment to Secure LNG Exports to Europe
