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U.S. Oil Output Seen Rising to Record 12.26 mln bpd in 2019

(Reuters) U.S. crude production is expected to rise by 1.27 million barrels per day (bpd) in 2019 to a record 12.26 million bpd, said the U.S. Energy Information Administration (EIA), slightly above its previous forecast for a rise of 1.25 million bpd.

Output in 2020 is forecast to rise by 910,000 bpd to 13.17 million bpd, according to the EIA, lower than its previous estimate of a rise of 990,000 bpd to 13.23 million bpd.

U.S. crude output has surged to records above 12 million bpd this year thanks to gains from the Permian basin, spanning Texas and New Mexico, the biggest oil patch in the United States, now the world's largest producer ahead of Saudi Arabia and Russia.

The rate of growth has, however, been tempered as U.S. energy companies reduced the number of oil rigs in September for a record 10th month, under pressure from investors to cut spending on new drilling.

The agency reduced U.S. demand forecast for 2019 to an increase of 40,000 bpd to 20.54 million bpd from a forecast last month for a rise of 140,000 bpd.

For 2020, the EIA expects U.S. petroleum and other liquid fuels demand to climb 220,000 bpd to 20.76 million bpd from a previous forecast of a 260,000 bpd-increase to 20.85 million bpd.

A prolonged trade war between China and the United States, the world's two largest economies, has roiled financial markets and sparked worries about economic and oil demand growth.

"The October Short-Term Energy Outlook revised the forecast for average 2020 Brent crude oil spot prices down $2 to $60 per barrel, despite last month's higher prices following the attacks on Saudi oil installations," said EIA Administrator Linda Capuano.

"The events in Saudi Arabia and other supply risks are balancing downward price pressures resulting from decreasing demand."

The attacks on the heartland of Saudi Arabia's oil industry in September damaged the world's biggest petroleum-processing facility and knocked out more than 5% of global oil supply.

The EIA also cut its 2020 world oil demand growth forecast by 100,000 bpd to 1.30 million bpd.


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