Growth with U.S. shale oil production is expected to slow down in 2020 due to the fall of crude oil prices, according to independent oil and gas research company JBC Energy GmbH based in Vienna of Austria.
U.S. supply of shale oil would grew 760,000 barrels/day year on year in 2020 in comparison with earlier forecast of 880,000 barrels/day, said a research note released by JBC Energy on Friday, citing fall of crude oil prices in recent weeks.
JBC Energy noted that U.S. shale oil production is also highly susceptible to price signals though it's driven by substantially different forces and reacts with a longer time lag.
The currently suppressed price environment, which is not expected to disappear anytime soon, makes it more difficult for completion rate of oil wells to achieve previously expected recovery after completion rate of oil wells saw deep monthly declines in the last two months of 2019, said JBC Energy in the note.
The completion of an oil well is necessary in order to fracture the well and produce oil and gas.
U.S. Energy Information Administration (EIA) also trimmed forecast of averaged U.S. crude oil production by 100,000 barrels/day in its monthly short-term energy outlook report issued on Feb. 11.
U.S. crude oil production would average 13.2 million barrels/day in 2020, 1 million barrels/day higher from that in 2019, according to EIA.
The Organization of the Petroleum Exporting Countries and its partners are also expected to deepen production cut by around 500,000 barrels/day in a bid to bolster oil prices, according to multiple research institutions.
The prices of international crude oil futures slumped over 20 percent in last few weeks resulting from concerns over demand shock from the outbreak of novel coronavirus.
Editor:Cherie
