London, UK | – The U.S. Energy Information Administration trimmed its forecast of world oil demand growth next year and made even deeper cuts in its outlook for OPEC production, the latest signs of a shift toward surplus supplies next year.
The EIA cut its 2014 global demand forecast to 91.47 million barrels a day, compared with 91.55 million bpd expected last month, according to a monthly report from the agency on Tuesday. As a result, it now expects consumption to rise by 1.24 million bpd, down 100,000 bpd from the previous month’s report but still higher than the 1 million bpd increase estimated for 2014.
On the backdrop of weakening demand, the agency curbed its forecasts for OPEC oil and other liquid fuels production to 35.51 million barrels a day in 2015, down 350,000 bpd from last month’s forecast. For crude oil output alone the EIA cut its forecast by 300,000 bpd to 29.24 million bpd.
In September, OPEC pumped nearly 31 million bpd. The agency made little change in its outlook for U.S. crude oil production, which has consistently outstripped growth forecasts. The EIA expects U.S. 2015 oil production of 9.50 million bpd compared with 9.53 million bpd a month earlier.
The agency also cut its expectations for Brent prices to $101.67 a barrel in 2015, compared with $103 a barrel expected previously. “Weakening global demand helped North Sea Brent crude oil spot prices fall to an average of $97 per barrel in September, the first month Brent prices have averaged below $100/bbl in more than two years,” the EIA said in the report.
The EIA projects that Brent crude oil prices will average $98 a barrel in the fourth-quarter of 2014. After hitting highs on unrest in the Middle East in June, Brent has retreated in the past two weeks, and is currently trading that $91.83 a barrel.