The US Energy Information Administration (EIA) revised up its forecast for global crude oil prices for 2021, which was announced late Tuesday in its June Short-Term Energy Outlook (STEO), according to Anadolu Agency.
International benchmark Brent crude is now estimated to average $65.19 per barrel in 2021, up from last month’s forecast of $62.26 a barrel for this year.
The agency projects Brent will average $67.44 per barrel in the second quarter of 2021 and $66 per barrel during the second half of 2021, while the prices are forecast to be in the neighborhood of $60.40 per barrel in 2022.
American benchmark West Texas Intermediate (WTI) is expected to average $61.85 for 2021 and $56.74 next year.
The agency said Brent prices averaged $68 per barrel in May, as global oil inventories continued to decline, albeit at a slower pace than in the first four months of the year.
Despite rising COVID-19 case counts in some countries, particularly India, the agency said global oil demand remained higher than supply in May, contributing to continued global withdrawals from inventories of crude oil and petroleum products.
The EIA forecast that OPEC crude oil production will average 26.9 million barrels per day (bpd) in 2021 and 28.7 million bpd in 2022, up from the agency’s previous forecast as OPEC is expected to raise production by about 1 million bpd in both June and July in response to rising global oil demand and seasonal increases in oil consumption for power generation for some OPEC members.
“It also reflects an assumption that Iran’s crude oil production will continue to increase this year. Although sanctions that target Iran’s crude oil exports remain in place, crude oil exports—according to ClipperData, LLC.—and production from Iran are up from most of 2020,” it said.
US crude oil production, which was 11.3 million bpd in 2020 and 12.2 million bpd in 2019, is estimated to average 11.1 million bpd in 2021, down from 11.2 million bpd in the previous STEO.
As producers are forecast to drill and complete enough wells to raise 2022 production from 2021, the country’s oil production is estimated to rise to 11.8 million bpd in 2022.
According to the agency, total world consumption of petroleum and liquid fuels will average 97.7 million bpd for all of 2021, marking a rise of 5.4 million bpd from 2020. This is unchanged from the previous forecast.
The agency also estimated that global consumption next year would increase by 3.6 million bpd to average 101.3 million bpd.