U.S. oil production fell sharply in 2020, but the Energy Information Administration expects it to recover and even set new records in just two years, it said in its expected annual energy outlook (AEO2021).
According to the EIA, US oil production in 2023 will exceed its previous annual average of 12.25 million barrels per day, reached in 2019.
By 2020, U.S. oil production had reached a maximum of 13.1 million barrels per day on average for the week ending March 13th. .
However, U.S. energy consumption will take years to return to 2019 levels, eight years more exactly. However, the EIA notes that “this projection depends very much on the pace of US economic recovery.”
According to AEO2021, electricity demand is expected to return to 2019 levels in 2025, again, a slower recovery than U.S. oil production, which also has export markets to take advantage of.
Related: China’s oil storage levels are falling in early 2021
U.S. production could return to 2019 levels is remarkable, given that domestic consumption will take more years to recover.
Currently, according to the EIA, US oil production averages 10.9 million barrels per day, 2.2 million bpd below the highs reached in March 2020.
The number of active drilling rigs is on an upward trajectory, but overall the number of active drilling rigs remains 400 below what it was just a year ago.
Meanwhile, OPEC production is also falling by millions of barrels a day from 2019 levels as part of its coordinated production cuts.
By Julianne Geiger for Oilprice.com
More highlights from Oilprice.com: