EIA Raises 2021 Oil Price Forecasts
The U.S. Energy Information Administration (EIA) has raised its Brent spot average and West Texas Intermediate (WTI) spot average prices for 2021, according to its latest short-term energy outlook (STEO) report.
In its January STEO, the EIA sees 2021 Brent spot prices averaging $52.70 per barrel and 2021 WTI spot prices averaging $49.70 per barrel. The EIA revealed in its December STEO that it saw 2021 Brent spot prices averaging $48.53 per barrel and 2021 WTI spot prices averaging $45.78 per barrel. Oil prices are further expected to increase in 2022, according to the EIA’s January STEO, which projects a Brent spot average of $53.44 next year and a WTI spot average of $49.81.
The EIA estimates that global consumption of petroleum and liquid fuels averaged 92.2 million barrels per day for all of 2020, which it said was down nine million barrels per day from 2019. The organization expects global liquid fuels consumption will grow by 5.6 million barrels per day in 2021 and by 3.3 million barrels per day in 2022.
The EIA also estimates that global liquid fuels inventories rose at a rate of 6.5 million barrels per day in the first half of 2020 before declining at a rate of 2.4 million barrels per day in the second half of 2020. It forecasts that global inventories will continue to fall, declining at a rate of 0.6 million barrels per day this year and 0.5 million barrels per day next year. U.S. crude oil production is estimated to have fallen from the 2019 record level of 12.2 million barrels per day to 11.3 million barrels per day in 2020. The EIA expects that annual average production will fall to 11.1 million barrels per day this year before rising to 11.5 million barrels per day in 2022.
The EIA noted that its January STEO remains subject to heightened levels of uncertainty because responses to Covid-19 continue to evolve.
“Reduced economic activity and changes to consumer behavior in response to the Covid-19 pandemic caused energy demand and supply to decline in 2020,” the EIA said in its latest STEO.
“The ongoing pandemic and the success of vaccination programs will continue to affect energy use in the future,” the EIA added.
The EIA is the statistical and analytical agency within the U.S. Department of Energy. It collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment, according to its website.
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