The US Federal Gulf of Mexico accomplished an annual record reaching the US cruse oil production of 1.8 million barrels per day in 2018, and EIA now expects that the oil production in GOM will set new production records for 2019 and 2020.
The halts in productions related to Hurricane Berry in July 2019 and including expected adjustments for hurricane-related shut-ins for the remainder of 2019 and for 2020, EIA sees future records in the Gulf of Mexico.
EIA’s latest Short-Term Energy Outlook forecasts that the production levels at new and existing fields, annual crude oil production in the GOM will increase to an average of 1.9 million b/d in 2019 and 2.0 million b/d in 2020. Yet, despite the increase, GOM’s share in the US total oil production will be smaller, as it is expected to account for the 15% of the overall US crude oil production in 2019 ans 2020.
Moreover, GOM’s crude oil production experienced a decline in 2019; From 1.9 million b/d in June to 1.6 million b/d in July because some production platforms were evacuated in anticipation of Hurricane Barry. Waiting for final data to be published, EIA believes that crude oil production for August reached the 2.0 million bpd.
Producers expect eight new additional projects to come into force in 2019 and four more in 2020; Accordingly, EIA’s estimations see that the projects will contribute to about 44,000 b/d in 2019 and about 190,000 b/d in 2020 as projects ramp up production.
Crude oil price increases in 2017 and 2018 relative to lows in 2015 and 2016 have not yet had a significant effect on operations in the GOM, but they have the potential to contribute to increasing rig counts and field discoveries in the coming years
… states EIA.
Concerning crude oil prices Rystad commented that the IMO 2020 sulphur regulation will be one of the three pillars to determine oil prices. In the meantime, KPI Oil Bridge said it is waiting for the new sulphur regulations to cause a price increase of 30-40% depending on the region and local availability.
