U.S. Energy Information Administration forecast in its latest short-term energy outlook that the Brent crude oil price will remain above $95 per barrel over the next two months. Crude oil prices increased in March as shipments through the Strait of Hormuz fell, some Middle East oil production was shut in, and some production in Middle East stopped. EIA said March 10 in its report, “This price forecast is highly dependent on … the duration of conflict in the Middle East and resulting outages of oil production.”
EIA expects the oil price to fall below $80 per barrel in third quarter and reach $70 per barrel by the end of the year. The oil price is expected to average $64/b in 2027.
The report added, “Higher oil prices lead to more U.S. crude oil production in our forecast.” EIA expects U.S. crude oil production to average 13.6 million barrels per day this year and rise to 13.8 million b/d in 2027. And higher crude oil production results in more associated natural gas production. EIA expects marketed natural gas production to average 121 billion cubic feet per day this year and increase to 124 Bcfd in 2027.