U.S. crude oil output fell in December for first time in 5 months
Friday, February 28, 2020 11:49 a.m. EST by Thomson Reuters
NEW YORK (Reuters) - U.S. crude oil output fell to 12.78 million barrels per day in December from 12.86 million bpd in November, the U.S. Energy Information Administration (EIA) said in a monthly report on Friday.
U.S. crude production has soared due to technological advances for production from shale formations. Despite the decline in December, weekly production data from the EIA suggests that crude output has risen in January and February, setting a fresh record of 13 million bpd.
Gasoline demand in December fell from a year earlier, according to the report. Demand dropped about 2.5% to 8.945 million bpd. This was a steeper decline than the 1% year-on-year drop seen in November.
Demand for distillate fuel, which includes diesel and heating oil, fell 3% from the previous year to 3.901 million bpd, compared with a 0.4 percent decline seen in November.
(Reporting By Jessica Resnick-Ault; Editing by David Gregorio and Diane Craft)
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EIA: US December crude production fell
Re: EIA: US December crude production fell
I told you so! There is NO WAY that U.S. oil production can increase at the current active rig count. The number of rigs drilling for oil & gas is down 23% and there is zero chance of an increase is WTI stays under $50/bbl. This means we will see an oil shortage in Q3 unless COVID-19 kills a million people within six months, which of course is not going to happen. - Dan
US Oil Rig Count Falls Slightly As Producers Cut Spending with my comments in blue
Reuters Fri, 02/28/2020 - 12:31 PM
U.S. energy firms reduced the number of oil rigs operating for the first time in four weeks as some companies expect output growth from shale formations to slow as producers cut spending on new drilling for a second consecutive year in 2020.
Drillers cut one oil rig in the week to Feb. 28, bringing down the total count to 678, energy services firm Baker Hughes Co. said in its weekly report. That is a decline of 20% from the same week last year when 843 rigs were active. < We need at least 800 rigs drilling for oil just to hold production flat.
In February, drillers added three rigs, their second monthly increase in three months.
U.S. crude futures traded at about $45 per barrel on Feb. 28, putting the contract on track to fall by the most in a week since 2008 as the global spread of the coronavirus stokes demand fears.
Looking ahead, U.S. crude futures were trading at about $45 per barrel for the balance of 2020 and about $47 for calendar 2021. That compares with an average of $57.04 in 2019.
The oil rig count, an early indicator of future output, dropped by an average of 208 rigs in 2019 after rising 138 rigs in 2018 as independent E&P companies cut spending on new drilling to meet shareholder demand for better financial returns in a low energy price environment.
The U.S. Energy Information Administration projected crude output will rise about 8% in 2020 to 13.2 million barrels per day (MMbbl/d) and 3% in 2021 to 13.6 MMbbl/d from a record 12.2 MMbbl/d in 2019.
Growth in U.S. shale oil production will slow sharply over the next two years, the chief executive officer of U.S. oilfield services giant Schlumberger NV said on Feb. 25.
U.S. financial services firm Cowen & Co. said 40 of the independent E&Ps it watches reported spending estimates for 2020, implying a 13% year-over-year decline in 2020.
Year-to-date, the total number of oil and gas rigs active in the United States has averaged 791.
Analysts at Simmons Energy, energy specialists at U.S. investment bank Piper Sandler, have forecast the annual average combined oil and gas rig count will slide from 943 in 2019 to 816 in 2020 before rising to 848 in 2021.
That is the same as Simmons forecasts since early January and means Simmons expects the weekly rig count will rise from its current level later in the year. < The active rig count will not increase unless WTI moves over $60/bbl.
US Oil Rig Count Falls Slightly As Producers Cut Spending with my comments in blue
Reuters Fri, 02/28/2020 - 12:31 PM
U.S. energy firms reduced the number of oil rigs operating for the first time in four weeks as some companies expect output growth from shale formations to slow as producers cut spending on new drilling for a second consecutive year in 2020.
Drillers cut one oil rig in the week to Feb. 28, bringing down the total count to 678, energy services firm Baker Hughes Co. said in its weekly report. That is a decline of 20% from the same week last year when 843 rigs were active. < We need at least 800 rigs drilling for oil just to hold production flat.
In February, drillers added three rigs, their second monthly increase in three months.
U.S. crude futures traded at about $45 per barrel on Feb. 28, putting the contract on track to fall by the most in a week since 2008 as the global spread of the coronavirus stokes demand fears.
Looking ahead, U.S. crude futures were trading at about $45 per barrel for the balance of 2020 and about $47 for calendar 2021. That compares with an average of $57.04 in 2019.
The oil rig count, an early indicator of future output, dropped by an average of 208 rigs in 2019 after rising 138 rigs in 2018 as independent E&P companies cut spending on new drilling to meet shareholder demand for better financial returns in a low energy price environment.
The U.S. Energy Information Administration projected crude output will rise about 8% in 2020 to 13.2 million barrels per day (MMbbl/d) and 3% in 2021 to 13.6 MMbbl/d from a record 12.2 MMbbl/d in 2019.
Growth in U.S. shale oil production will slow sharply over the next two years, the chief executive officer of U.S. oilfield services giant Schlumberger NV said on Feb. 25.
U.S. financial services firm Cowen & Co. said 40 of the independent E&Ps it watches reported spending estimates for 2020, implying a 13% year-over-year decline in 2020.
Year-to-date, the total number of oil and gas rigs active in the United States has averaged 791.
Analysts at Simmons Energy, energy specialists at U.S. investment bank Piper Sandler, have forecast the annual average combined oil and gas rig count will slide from 943 in 2019 to 816 in 2020 before rising to 848 in 2021.
That is the same as Simmons forecasts since early January and means Simmons expects the weekly rig count will rise from its current level later in the year. < The active rig count will not increase unless WTI moves over $60/bbl.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: EIA: US December crude production fell
Fwiw, the EIA's December production report (12.779 mbpd) was slightly lower than EIA’s December weekly production estimates (which averaged 12.85 mbpd) https://www.eia.gov/dnav/pet/hist/LeafH ... RFPUS2&f=W.
Re: EIA: US December crude production fell
In Q1 2019 the EIA's weekly numbers were higher than the monthly reports. February was the largest miss and the weekly reports were about 350,000 BOPD higher than actual production.
EIA has a tough job trying to guess the weekly production. Just remember that they are just their best guess.
EIA has a tough job trying to guess the weekly production. Just remember that they are just their best guess.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group