NEW YORK (Reuters) - U.S. crude oil production is expected to average 12.06 million barrels per day (bpd) in 2019, passing the 12 million bpd milestone sooner than expected on surging domestic shale output, the U.S. Energy Information Administration said on Tuesday.
For 2019, production is expected to rise 1.16 million bpd from the prior year, more than EIA’s previous forecast for a 1.02-million bpd rise.
The agency’s monthly report said EIA expects production to surge above 12 million bpd in the second quarter of 2019, sooner than its previous estimate of the fourth quarter.
Output this year is forecast to rise by 1.55 million bpd to 10.90 million bpd. That projected increase is an upward revision from its earlier estimate of a 1.39 million bpd rise.
A shale revolution has helped push U.S. crude production to record highs, rivaling top producer Russia and outpacing Saudi Arabia. Russian oil output reached another 30-year high of 11.41 million barrels per day in October.
The increase in U.S. production has largely come from the Permian basin, the largest U.S. oilfield, and the Bakken, where production has soared to new peaks.
“U.S. crude oil production reached a record milestone in August 2018, when it exceeded 11 million barrels per day for the first time,” EIA Administrator Linda Capuano said.
“U.S. production has exceeded EIA’s previous expectations and, as a result, the short-term outlook now forecasts U.S. crude oil production to exceed 12 million barrels per day in 2019.”
For 2018, U.S. oil demand is expected to rise by 510,000 bpd to 20.47 million bpd, EIA said, slightly raising its previous forecast of a 450,000 bpd rise to 20.41 million bpd.
For 2019, oil demand is estimated to rise by 220,000 bpd, a small downward revision from the previous estimate of a rise of 230,000 bpd.
As supply grows, the oil market has grown more concerned about the demand outlook, particularly as trade tensions between the United States and China threaten growth in the world’s two biggest economies and as currency weakness pressures economies in Asia.
Oil prices fell on Tuesday with U.S. crude touching the lowest since early April.
Reporting by Devika Krishna Kumar in New York; Editing by David Gregorio
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