LONDON (Reuters) - BP expects benchmark oil prices to weaken in the second half of the year as U.S. shale production surges by up to 1.5 million barrels per day, Chief Financial Officer Brian Gilvary said on Tuesday.
The London-based oil and gas producer still sees oil prices averaging $50 to $60 per barrel this year despite Brent crude reaching around $75, its highest since late 2014.
“We’re still planning for $50-$60 a barrel, that’s a good place to sit,” Gilvary told Reuters in a phone interview.
“What we’re seeing now is strong demand, OPEC compliance, you’re seeing geopolitics playing to the front end of the market.”
“That will start to get dampened as you see Lower 48 (U.S. states) production ramp up. You will see at least 1 million to 1.5 million barrels per day coming out of the Lower 48 this year.”
Reporting by Ron Bousso; editing by Jason Neely