Oil in Global Economy Series: EIA revises US production outlook to upside

United States’ Energy Information Administration (EIA) said that the production volumes in the United States are rising for the first time since 2015 and the agency is changing its production forecast from a 0.9 percent decline in 2017 to 1.3 percent increase. US field production, after bottoming in July last year, around 8.428 million barrels per day has jumped to 8.77 million barrels per day as of last week. EIA forecasts that the production would rise to 9 million barrels per day by the end of the year. It also forecasts another 300,000 barrels per day increase in 2018. However, these levels are still lower than the peak reached in 2015, when the production hit 9.61 million barrels per day.

The traders and investors have been closely watching the US production level as the country remains outside the deal agreed by N-OPEC countries and when price become favorable can significantly pop up production.

The crude oil price has declined to $51 per barrel for WTI and $53.7 per barrel for Brent, as market fears increased supply from non-OPEC producers.