U.S. crude oil production is expected to rise by 1.06 million barrels per day (bpd) in 2020 to a record of 13.30 million bpd, the U.S. Energy Information Administration (EIA) said on Tuesday, above its previous forecast for a rise of 930,000 bpd, ONA reports citing Reuters.
The output in 2021 is forecast to rise by 410,000 bpd to 13.71 million bpd, according to the EIA.
“We forecast U.S. crude oil production will reach new records in 2020 and 2021, driven primarily by higher production in the Permian region of Texas and New Mexico,” EIA Administrator Linda Capuano said in a statement.
“Both global oil supply and consumption are expected to grow in 2020, with supply from non-OPEC producers, particularly the Unites States, Norway, Brazil, and Canada, more than offsetting declining production from OPEC.”
A shale boom has helped make the United States the world’s biggest oil producer, overtaking Saudi Arabia and Russia.
However, the rate of growth is expected to slow into next year as U.S. oil producers follow through on plans to slash spending on new drilling for a second year in a row in 2020.
In 2019, the oil rig count, an early indicator of future output, notched its first annual decline since 2016 as independent exploration and production companies cut spending on new drilling as shareholders seek better returns in a low energy price environment.
For 2020, the agency expects U.S. petroleum and other liquid fuels demand to climb 160,000 bpd to 20.64 million bpd in 2020, below its previous forecast for a rise of 170,000 bpd to 20.75 million bpd.
Demand is expected to rise 70,000 bpd to 20.71 million bpd in 2021, the EIA said.