EIA Data Shows Oil Output Continues to Grow at Faster-Than-Expected Rate — OPIS

U.S. oil production continues to grow at a faster rate than had been forecast, though natural gas output is likely to decline over the coming weeks, the Energy Information Administration said Monday.

In its April Drilling Productivity Report, the agency said it expects oil output in the seven oil and gas plays in the contiguous U.S. to average 9.847 million barrels a day this month and 9.863 million b/d in May. The April forecast is up by about 78,000 b/d from what EIA predicted in its March report.

Much of the higher forecast was due to EIA raising its expectations for production in the Bakken and Eagle Ford Basins. The agency boosted its April forecast of Bakken output by 1.3% to 1.245 million b/d and increased its expectation for Eagle Ford by just over 1% to 1.147 million b/d. Bakken production continues to recover from a mid-January cold snap that briefly cut output in half.

EIA's latest report also reduced its U.S. natural gas production estimate by 0.4% to 100.202 billion cubic feet a day. In addition, the report predicted output will continue to fall in May, dropping 0.25% to 99.944 Bcf/d.

While oil prices have risen about 20% so far this year, with West Texas Intermediate crude now at about $85/bbl, a warmer U.S. winter dropped natural gas demand and boosted inventories, pressuring prices heading into the warmer summer months.

The April report also shows a surge in the number of drilled but uncompleted wells in the seven plays.

EIA said the number of DUC wells in February totaled 4,513, an increase of 30 from what was reported last month. It also said that number rose by nine in March to 4,522. The March total is the highest since October.

An increase in the number of DUC wells is seen as supportive of increased future production, as they provide a quick way for drillers to increase output amid increasing prices.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

--Reporting by Steve Cronin, scronin@Opisnet.com; Editing by Jeff Barber, jbarber@opisnet.com

(END) Dow Jones Newswires

April 15, 2024 13:50 ET (17:50 GMT)

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