Energy

US Oil Production to Fall by Almost a Million Barrels a Day by 2017

Paul Ausick

Published: January 12, 2016 1:45 pm

Last Updated: January 13, 2020 3:08 pm

In the latest revision of its Short-Term Energy Report, the U.S. Energy Information Administration (EIA) said the total U.S. crude production fell to an average of 9.4 million barrels a day in 2015 and that production will slide to an average of 8.7 million barrel a day this year and 8.5 million barrels a day in 2017. The agency also said that December production fell month over month to 80,000 barrels a day.

Brent crude oil prices averaged $38 a barrel in December, a decrease of $6 a barrel from November and the lowest monthly average price since June 2004. Brent crude prices averaged $52 a barrel in 2015, down a massive $47 a barrel from the 2014 average. The EIA estimates Brent crude will average just $40 a barrel for the current year, rising to an annual average of $50 a barrel in 2017.

The price for a barrel of West Texas Intermediate (WTI) crude is forecast to average $2 a barrel less than Brent in 2016 and $3 less than Brent in 2017. In mid-afternoon trading Tuesday, the differential favors Brent by less than 50 cents a barrel.

The U.S. pump price of regular gasoline is forecast to average $2.03 a gallon in 2016 and $2.21 a gallon in 2017, compared with an annual average of $2.43 in 2015. In December, average retail regular gasoline prices fell to $2.04 a gallon, a decrease of 12 cents from November and 51 cents lower than in December 2014. EIA expects monthly pump prices of regular gasoline to reach a seven-year low of $1.90 a gallon in February 2016, before rising during the spring refinery maintenance and turnaround season.