U.S. Energy Information Administration forecast more than 5 million barrels per day in crude oil production in Permian Basin for the second straight month. EIA expects production of 5.076 million b/d for February – up 80,000 b/d from 4.996 million b/d in January. EIA had forecast 5.031 million b/d for January – its first monthly forecast of at least 5 million b/d. Across seven major producing regions, EIA on Jan. 18 forecast February production of 8.540 million b/d – up 104,000 b/d from 8.436 million b/d in January.
Natural gas production in Permian in February is forecast at 20.058 billion cfd – up 122 million cfd from 19.936 billion cfd in January. Across seven major producing regions, gas production is forecast for February at 90.215 billion cfd – up 387 million from 89.828 billion cfd in January. Appalachia remains the top producing region for gas (up 81 million cfd to 35.069 billion cfd in February).
All seven regions again reported declines in drilled but uncompleted wells, including 1,446 DUC wells in December 2021 after 1,537 in November in Permian. In the seven regions in December there were 4,616 DUC wells after 4,830 in November.
EIA also said U.S. total crude oil production declined again to 11.2 million b/d last year after falling 8 percent in 2020 to 11.3 million b/d. Production is forecast to average 11.8 million b/d this year and 12.4 million b/d in 2023.
And EIA said it expects the average price of oil (Brent crude oil, international pricing benchmark) to fall to $75 per barrel this year and $68 in 2023 after $79 in 2021Q4. “The declining prices are driven by a shift from global petroleum inventory declines during 2021 to inventory increases in 2022 and 2023,” EIA said Jan. 12. “In 2021 withdrawals from global petroleum inventories averaged 1.4 million b/d and contributed to higher crude oil prices. These inventory draws resulted from petroleum consumption returning faster than petroleum production after the covid19 pandemic began in 2020. In 2022 we expect that petroleum production will increase and consumption growth will slow, leading to increases in petroleum inventories globally.”