- Price Outlook for 2024 – 2025 reviewed downward
The EIA has revised the United States petroleum and other liquid fuels consumption averaging 20.5 million barrels per day in 2024—up from the agency’s forecast in July of 20.4 million bpd.
On the global level, EIA reports that the world’s total crude oil and liquid fuels consumption levels remained unchanged at 102.9 million bpd for 2024, revising its 2025 global fuels consumption slightly downward to 104.5 million bpd from 104.7 million bpd – with these figures said to represent growth of 1.1 million bpd this year, and 1.6 million bpd next year, an international oil and gas news agency reported.
For Brent pricing, the EIA reduced its forecast for this year and next, lowering its projections by $2 per barrel to $84 per barrel for the full year 2024. For next year, the EIA also revised its forecast down by $2 per barrel to an average of $86 for the full year – OilPrice reports.
While prices have been recently on a downward trend and the full-year 2024 guidance has been reduced, the EIA continues to expect crude oil prices to rise in the second half of 2024. The Brent spot price ended July at $81 per barrel, the EIA said, but averaged $85 per barrel for the month. The EIA also sees Brent returning to between $85 per barrel and $90 per barrel by the end of the year, report had shown, while also foreseeing these prices rising with the progress into the latter part of the year, on the back of global crude oil inventories decreasing by 800,000 bpd in the second half.
Meanwhile the U.S. Department of Energy (DOE) was reported to have moved on in its efforts to bolster the depleted Strategic Petroleum Reserve (SPR) with new oil purchases. The Office of the Petroleum Reserves of DOE was also reported to have made a call for bids to supply up to 1.5 million barrels of oil to the Bayou Choctaw site in January 2025, with additional solicitation for August 12, 2024, for another 2 million barrels destined for the Bryan Mound site, also for delivery in January 2025. This move according to the report is part of a strategic plan to replenish the SPR while taking advantage of favorable oil prices.
The DOE’s stated goal is to buy crude oil at or below $79 per barrel, the report highlighted.
The replenishment strategy the report notes comes in the wake of the SPR’s critical role in stabilizing the market during global supply disruptions, notably the release of more than 180 million barrels of oil from the SPR which started in 2021, as gasoline prices remained high. This is as the report writes the Treasury Department as claiming that the releases, along with coordinated international efforts, were much instrumental to the reduction in gasoline prices down to the 40 cents per gallon witnessed in 2022.
The deadlines for submitting bids are set for August 13, 2024, for the Bayou Choctaw site and August 20, 2024, for the Bryan Mound site.
The SPR currently houses 375 million barrels of crude oil—a figure that is 263 million barrels less than oil in the SPR at the beginning of President Joe Biden’s term in office. The SPR, capable of storing as many as 714 million barrels of crude oil, is kept in underground salt caverns at four sites in Texas and Louisiana and was designed to protect the economy and American livelihoods during oil shortages.