Oil prices sit at three-year highs as march to $70 slows

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The nuclear share of generation was 20% in 2017 and is forecast to average 20% in 2018 and 19% in 2019. OPEC in December, however, produced about 50,000 barrels per day more than in November.

WTI light sweet oil was down 35 cents at USD63.47 a barrel, having touched its highest since December 2014. The global supply of oil exceeded demand by as many as 2 million barrels per day and inventories swelled.

The crude market's focus has so far been on signs of tightening supplies as the Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) and Russian Federation lead production cuts aimed at propping up prices.

Novak said the current oil price was short-term, and he would discuss the situation at a ministerial monitoring committee meeting in Oman, scheduled for January 21.

The price upturn began in June previous year, and now prices are nearing levels from late 2014.

Expectations of another drain on USA crude oil inventories supported a soft increase in oil prices early Tuesday, though a reversal may be overdue. While this spike in demand is an opportunity for US producers, it comes at a cost to consumers in the region. This is the first STEO to forecast through 2019 and it contains updates for 2018 forecasts. The American Petroleum Institute on Tuesday, however, had reported a decline of 11.2 million barrels, according to sources.

US shale is expected to continue to counteract OPEC production cuts this year.

US energy companies added 10 oil rigs this week, the biggest increase since June, bringing the total rig count to 752, the most since September, General Electric Co's (GE.N) Baker Hughes energy services firm said. China's crude imports in December fell 9 per cent month-on-month to 33.7 million tonnes, or 7.97 million bpd, customs data showed.

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While this shortage is a hard situation to manage, Startsman said that it is nothing the hospital hasn't dealt with before. McLaren Northern Michigan Hospital in Petoskey has been working around a shortage of smaller IV bags for several months.

Eagle Ford production is expected to be from 1.2 million bpd to 1.3 million bpd this year and next, which EIA said is slightly above the 2017 level.

Production was expected to hit 10.04 million bpd during the first quarter of this year, the agency said in a monthly report.

Gulf of Mexico production is expected to average 1.7 million bpd in 2018, relatively unchanged from 2017, and then increase to 1.8 million bpd with the anticipated start of production from the Appomattox project in the Rydberg field and the Mars project in the Kaikias field, along with other projects expected to begin operations this year and next.

The Energy Information Administration (EIA) recently unveiled its Short-Term Energy Outlook, which is forecasting the price of crude oil to rise about 13 percent or $7/barrel by 2019.

“Domestically, things are lining up in terms of moderate prices and increased opportunity for production.”.

Overall, dry natural gas production averaged 73.6 billion cubic feet per day in 2017, up 1 percent from 2016.

The EIA said it expects the share of U.S. total utility-scale electricity generation from natural gas to rise from 32% in 2017 to 33% in 2018 and to 34% in 2019, as a result of low natural gas prices. EIA said if the 6.9 bcf increase is achieved in 2018, it would be the highest on record.

"The decline comes in an environment of a falling USA dollar, which is an offsetting factor", he added.