Oil markets cling to near three-year highs on tighter United States market

Oil Surplus Returns       Both OPEC and IEA forecasts suggest stockpiles will grow again in 1H                          
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Oil Surplus Returns Both OPEC and IEA forecasts suggest stockpiles will grow again in 1H .cha

EIAs January Short-Term Energy Outlook forecasts Brent to average $60/b in 2018 and $61/b in 2019.

Brent crude futures rose 27c to $69.47 a barrel at 10.39 GMT, its highest since an intraday spike in May 2015. The president must regularly weigh sanctions and not extending them would've pulled the estimated 1 million barrels of Iranian oil flowing in the global market.

Prices have fallen for three years straight since then because of a meeting between oil-producing nations on Thanksgiving where Saudi Arabia, the biggest oil exporter, said it would not curb output to balance out an worldwide glut.

Homes that use heating oil will spend an average of $215 or 17 percent more this year than last, and that's assuming a "normal" winter.

The Paris-based IEA, for its part, said in its latest Oil Market Report from December that "On considering the final component in the balance - non-OPEC production - we see that 2018 might not be quite so happy for OPEC producers". EIA's latest Short-Term Energy Outlook (STEO) from earlier this week estimated that USA crude oil production averaged 9.3 million bpd in the whole of 2017, and 9.9 million bpd in December alone.

Non-OPEC production, led by the USA and Canadian oil sands projects, “is forecast to continue growing through the end of 2019, ” Conti said, with growth of 2 million bpd of non-OPEC production in 2018 and 1.3 million bpd in 2019.

USA demand growth of 150,000 bpd was estimated for 2017, slightly lower than previous expectations.

US crude production is forecast to average 10.3 million bpd in 2018, which would be the highest annual average USA production, surpassing a previous record of 9.6 million bpd in 1970.

USA crude oil production is expected to hit 10 million bpd next month, behind only Russian Federation and Saudi Arabia. Platts last week expected a 5.7 barrel million draw, though federal data showed a decrease of 7.4 million barrels.

Most of the growth in U.S. output will come from the Permian basin, a huge shale region spanning western Texas and New Mexico.

That would match the all-time monthly record of 10.04 million bpd set in November 1970; oil production declined after that as the United States increasingly relied on imported crude.

Eagle Ford production is expected to be from 1.2 million bpd to 1.3 million bpd this year and next, which EIA said is slightly above the 2017 level. The 10 million-bpd milestone previously had not been expected to be reached until the fourth quarter.

Mentioning the recent price increase, Zanganeh said that the boost is due to the production decline on the side of OPEC members.

Overall, dry natural gas production averaged 73.6 billion cubic feet per day in 2017, up 1 percent from 2016. On Jan. 9, the World Bank increased its global economic growth estimates for 2018 to 3.1 percent after growth in 2017 was stronger than expected. EIA said if the 6.9 bcf increase is achieved in 2018, it would be the highest on record.

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