MCX Crude oil plummeted today as global cues turned frail and is currently down 2.30% at Rs 3916 per barrel. Brent Crude oil futures fell 2.52% to close at $60.81 per barrel on Wednesday. The commodity extended losses today and is currently down 1.43% at $59.92 per barrel. Brent crude oil spot prices averaged $59 per barrel (b) in August, down $5/b from July and $13/b lower than the average from August of last year. EIA forecasts Brent spot prices will average $60/b in the fourth quarter of 2019 and $62/b in 2020. EIA forecasts that West Texas Intermediate (WTI) prices will average $5.50/b less than Brent prices in 2020.
EIA forecasts that global liquid fuels consumption will increase by 0.9 million barrels per day (b/d) in 2019, down from year-over-year growth of 1.3 million b/d in 2018. The slowing liquid fuels demand growth reflects EIA’s assumption (based on forecasts from Oxford Economics) of decelerating growth in global oil-weighted gross domestic product (GDP). EIA expects that global liquid fuels demand will increase by 1.4 million b/d in 2020 as a result of an expected increase in global GDP growth.
EIA forecasts US crude oil production will average 12.2 million b/d in 2019, up by 1.2 million from the 2018 level. Forecast crude oil production then rises by 1.0 million b/d in 2020 to an annual average of 13.2 million b/d. The slowing rate of crude oil production growth reflects relatively flat crude oil price levels and slowing growth in well-level productivity.
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