US oil production will grow higher in 2022

IHS Markit expert: US oil production will increase in 2022

US oil production has recovered and is expected to soar in 2022 after more than a year OPEC and its allies dominated the market.

US oil production is forecast to reach 11.85 million barrels per day in 2022. Photo: AFP

In an interview with CNBC, Daniel Yergin, vice president of market research firm IHS Markit (UK) forecast that US oil production could increase by 900,000 barrels per day in 2022.

Previously, US oil companies were forced to cut production in 2020 due to the Covid-19 pandemic, which “freezes” demand and supply has not yet recovered as before the pandemic.

According to the US Energy Information Administration, the country produced 12.29 million barrels of crude oil per day in 2019. This will drop to 11.28 million barrels per day in 2020 and is estimated at 11.18 million barrels. in 2021. In 2022, US oil production is forecasted to increase to 11.85 million barrels per day.

“America is back,” said Daniel Yergin. “For the past year and a half, OPEC+ has dominated the market, but US oil production has recovered and production will grow higher in 2022.”

Mr. Daniel Yergin said the US Secretary of Energy had two exchanges to ask oil companies to increase production. “That, of course, is because the Biden administration is deeply concerned or concerned about inflation and its political implications,” added IHS Vice President Markit.

Mr. Daniel Yergin predicts oil prices will fluctuate in the range of 65-85 USD/barrel and the scenario of oil price climbing to 100 USD is unlikely “unless some major geopolitical instability occurs”.

Brent crude oil futures prices rose 0.49% to 79.62 USD/barrel in the morning session of December 30 (Asia time), while the price of US crude oil futures increased by 0.47% to nearly 0.47%. 76.92 USD/barrel.

Regarding US-Russia relations, Daniel Yergin said that it is likely that the North Atlantic Treaty Organization (NATO) has no intention of accepting Ukraine’s accession to this bloc.

Tensions on the Russia-Ukraine border have been escalating for weeks, and the United States and its European allies have expressed concern over the move. Russia strengthen the army in the border area.

US President Joe Biden and Russian President Vladimir Putin had a video exchange on December 7. Accordingly, Mr. Putin asked Ukraine to be denied membership in NATO, but the US side did not accept this request.

“Ukraine will not become part of NATO,” said Daniel Yergin. The question is how to reach an agreement that “saves face for the parties,” said IHS Vice President Markit.

Negotiations on Ukraine’s accession to NATO will be difficult, but “at least the parties will have discussions on this issue”, commented Daniel Yergin.