Industrial Forex: Will oil market tensions ease? US oil supply may "break" Saudi intentions

A new forecast from the U.S. Energy Information Administration (EIA) shows that,This year, U.S. oil production will grow faster than previously expected, becausesandThe tight oil market due to special production cuts provides additional crude oil supplies.

According to the EIA's monthly report released on Tuesday,Higher-than-expected well productivity and rising crude oil pricesWill help the U.S. boost production to a record 12.60 million barrels in 2023 from a previous forecast12.80 million barrels/dayIn 2022, the average U.S. production will be about 11.90 million barrels per day.

After OPEC + members cut back to prop up prices, additional U.S. production will help ease tensions in the oil market.sandTrump also recently extended its 1 million barrels per day production cut agreement by a month, bringing its output to its lowest level in years.

For OPEC's production, the Platts survey shows that due tosandSpecial major voluntary production cuts take effect.OPEC + cut crude oil production to nearly two-year low in July。sandThe recent production cuts and supply disruptions in Kazakhstan and Nigeria have offset increases in Iran and Iraq, leading toOPEC + production fell by nearly 1 million barrels per day.

The investigation found that...The 13 members of OPEC produce 27.34 million barrels a day, whileRussia and eight other allies produce 13.06 million barrels a day, for a total of 40.40 million barrelsThis is the lowest level for the group since August 2021In addition,sandProduction fell to 9.05 million barrels per day, the lowest level since June 2021.

EIA expects further increases in both U.S. and global production next yearThe agency said that toIn 2024, global oil production will increase to 103 million barrels per dayAn increase of 1.70 million barrels this year.inMore than 70% of the growth is expected to come from non-OPEC countries, led by the United States, Brazil, Canada, Guyana and Norway. The agency said,Next year, U.S. production will climb to 13.10 million barrels per day。Industrial foreign exchangeInvestors say oil market forecasts should be based on this.

At the same time, the EIA said the US would consume less refined fuel this year than previously thought. The country will use 4 per cent less jet fuel in the third quarter than previously forecast as the air travel boom begins to lose steam. The agency also downgraded its forecast for third-quarter and full-year gasoline and diesel consumption.

However, the EIA appears to have ignored the increase in LNG use and still raised its forecast for total US oil demand this year.