U.S. oil production is expected to hit a larger record this year than previously expected, the Energy Information Administration said on Tuesday, as expectations mount of a global supply glut.
The agency raised its forecast for 2025 oil production by 20,000 to average 13.61 million barrels per day in 2025, the highest on record. However, the EIA lowered its forecast for total output in 2026 by 50,000 to 13.53 million bpd. The step up in this year’s U.S. production forecast adds to expectations that the oil market is heading for a supply overhang after the International Energy Agency said last month that the global oil market faces an even bigger surplus next year of as much as 4.09 million barrels per day.
The Department of Energy’s statistical arm also raised its oil demand estimate by 100,000 bpd to 20.6 million bpd for 2025 and forecast that demand would be flat for 2026.
Prices of U.S. benchmark West Texas Intermediate crude will average $65.32 per barrel in 2025, up from its estimate last month of $65.15 per barrel, the EIA said. Global benchmark Brent prices will average $68.91 per barrel in 2025, higher than the $68.76 it forecast in November.
(Reporting by Liz Hampton in Denver, Arathy Somasekhar in Houston, Scott DiSavino in New York; editing by Barbara Lewis)