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EIA Revises Up Oil Price Forecasts on Saudi Cuts, Demand, Inventories

OIL

EIA forecasts Brent prices to average $86/bbl in in the second half of this year, up by $7/bbl from July’s report, driven by the extended voluntary cuts from Saudi Arabia and increasing oil demand, reducing global oil inventories according to the EIA STEO release yesterday.

  • EIA forecasts Brent prices to average $83/bbl in 2023 and $86/bbl in 2024.
  • Global liquids production growth has been revised up to 1.4mbpd for 2023, compared with 1.2mbpd in last month’s estimates. Production for 2024 has been revised up by more than 0.2mbpd to 1.7mbpd.
  • Growth in production is primarily driven by non-OPEC supplies by 2.1mbpd from the US, Brazil, Canada, Guyana and Norway.
  • US crude oil production has been revised up by 0.2mbpd to 12.8mbpd for 2023 and by 1.9% to 13.1mbpd for 2024, as a result of higher-than-expected well-level productivity and higher crude oil prices.

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