EIA is starting to notice the decline in active rig count

[dan_s]

Yesterday the EIA released their December Short Term Energy Outlook.

Not surprisingly, the EIA is walking down expectations for US supply growth from 4Q19 – 4Q20. During this period, the EIA is forecasting US supply growth of just 360k b/d (and from 1Q20 – 4Q20, growth of just 110k b/d).

For some perspective here, in the January 2019 STEO the EIA was projecting growth of 1.03mm b/d from 4Q19 – 4Q20.

The EIA’s global oil and liquids demand growth forecast was calibrated slightly lower to 1.42mm b/d in 2020 which is down from 1.52 b/d forecast at the beginning of this year. Meanwhile, the global liquids supply outlook has also come in and now sits at 102.29mm b/d vs. 102.58mm b/d last month.
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MY TAKE: https://oilprice.com/Energy/Oil-Prices/ ... 0-Oil.html

The International Energy Agency (IEA) relies on EIA for their U.S. oil production growth forecasts. Because EIA tends to over-state production growth and under-state demand growth in the U.S., it cause the IEA to do the same. I believe U.S. oil production will decline in Q1, just like it did last year. Year-over-year production might be up in the U.S., but that's only because we will start the year at a much higher rate.

[dan_s]

EIA's Short-Term Energy Outlook (STEO): https://www.eia.gov/outlooks/steo/