USA Oil and Gas Production Growth to Accelerate
U.S. oil and gas production growth will accelerate in 2022.
That’s according to Enverus Intelligence Research’s latest FundamentalEdge report, which outlined that oil output growth would rise above around 900,000 barrels per day and gas output growth would rise above around four billion cubic feet per day.
Supply chain headwinds defer some of this growth until the second half of the year as the rig count rises modestly, the report highlighted. The report forecasts that the rig count will peak at around 660 late in the first quarter, from around 640 today.
“For both commodities, we expect this strong U.S. production growth to bring prices down relative to current strip levels, although geopolitical tensions and OPEC outages present upside risk to Brent and WTI,” Enverus Intelligence Research noted in a statement sent to Rigzone.
“As prices weaken and base declines accelerate, U.S. production growth decelerates in 2023, to [around] 300,000 barrels per day and [around] one billion cubic feet per day, and rig counts moderate to [around] 560,” the statement added.
According to the report, robust North American supply growth along with seasonal demand weakening should trigger a global crude and product inventories build in the first half of this year. This build will pull oil prices into the mid-$70s during the same time period, Enverus Intelligence Research projected, adding that it believes OPEC will manage supply to maintain around a $70 per barrel Brent price floor for the medium term.
“If prices fall below that level for a sustained period, we expect the cartel will manage production to maintain price in the mid-$70s for the medium term,” Enverus Intelligence Research said in the statement.
U.S. crude oil production reached almost 11.8 million barrels per day in November 2021, according to the U.S. Energy Information Administration’s (EIA) latest short term energy outlook (STEO), which was released on February 8.
The EIA, which highlighted that was the most production in any month since April 2020, forecasted in its latest STEO that output will rise to an average of 12 million barrels per day in 2022 and 12.6 million barrels per day in 2023. This would be record-high production on an annual-average basis, according to the EIA, which noted that the previous annual average record of 12.3 million barrels per day was set in 2019.
Earlier this month, Standard Chartered highlighted that a surge in U.S. oil output in the fourth quarter of 2021 had gone largely unnoticed by the oil market and oil analysts. According to data published in a Standard Chartered research note sent to Rigzone at the time, the U.S. added over 900,000 barrels per day to supply in the second half of last year. Only Saudi Arabia produced more and the U.S. comfortably outperformed countries such as Russia, Canada, Iraq, Norway, the UAE and the UK, the data showed.
To contact the author, email andreas.exarheas@rigzone.com
What do you think? We’d love to hear from you, join the conversation on the
Rigzone Energy Network.
The Rigzone Energy Network is a new social experience created for you and all energy professionals to Speak Up about our industry, share knowledge, connect with peers and industry insiders and engage in a professional community that will empower your career in energy.
- Blockchain Demands Attention in Oil and Gas
- Macquarie Sees USA Oil Production Exiting 2024 at 14MM Barrels Per Day
- Oman Sees Increasing Ship-to-Ship Transfers of Russian Oil Bound for India
- CNPC Opens Sea-Land Oil Storage and Transport Facility in Bangladesh
- US Govt Makes Record Investment of $6B for Industrial Decarbonization
- Perenco Still Searching for Missing Person After Platform Incident
- Eni, Fincantieri, RINA Ink Deal on Maritime Decarbonization
- Falcon Oil Declares Commercial Flow Test Results for Shenandoah Well
- Oil Falls as US Inventories Increase
- Czech Utility CEZ Bucks Weaker Prices, Demand to Log Record Annual Profit
- Equinor Makes Discovery in North Sea
- Standard Chartered Reiterates $94 Brent Call
- India Halts Russia Oil Supplies From Sanctioned Tanker Giant
- Centcom, Dryad Outline Recent Moves Around Red Sea Region
- DOI Announces Proposal for Second GOM Offshore Wind Auction
- PetroChina Set to Receive Venezuelan Oil
- Czech Conglomerate to Buy Major Stake in Gasnet for $917MM
- US DOE Offers $44MM in Funding to Boost Clean Power Distribution
- Oil Settles Lower as Stronger Dollar Offsets Tighter Market
- UK Grid Operator Receives Aid to Advance Rural Decarbonization
- Chinese Mega Company Makes Major Oilfield Discovery
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Another Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Vessel Sinks in Red Sea After Missile Strike
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension
- Equinor Makes Discovery in North Sea
- Standard Chartered Reiterates $94 Brent Call