NEW YORK (Reuters) – U.S. crude oil production is expected to rise more than previously expected to 12 million barrels per day by the fourth quarter of 2019, the U.S. Energy Information Administration said on Tuesday in a monthly report.
The agency forecast that U.S. crude oil output will rise by 1.14 million barrels per day (bpd) to 11.86 million bpd on average next year, according to the short term energy outlook. Last month, it expected a 750,00-bpd year-over-year increase to 11.44 million bpd. Overall, the agency’s forecast has increased by more than 1 million bpd since January.
The forecast projects that U.S. crude output could reach 12 million bpd by the fourth quarter of 2019, nearly 500,000 bpd above previous estimates for production in that quarter.
The agency lifted its 2018 production estimate to 10.72 million bpd, expecting growth of 1.37 million bpd, according to the report.
U.S. crude output has surged since 2010, fueled by output from formations in states including Texas, New Mexico and North Dakota. This year, it has surpassed a previous long-standing output record.
At the same time, the agency left its projections for U.S. oil demand in 2018 unchanged at 20.38 million bpd and slightly lowered its 2019 forecast to 20.64 million bpd from 20.70 million bpd previously.
The crude market on Tuesday was gripped by reports on U.S. President Donald Trump’s nuclear plans, so any reaction to the data was muted.
The report also suggested high crude prices will pressure retail gasoline prices upward, to just below $3 a gallon during the summer driving season.