US crude oil production and demand will both rise in 2023 as oil consumption in China grows, the US Energy Information Administration (EIA) said on Tuesday.
EIA predicts that US crude oil production will increase by 590,000 barrels per day to 12.44 million barrels per day in 2023, and another 190,000 barrels per day next year to 12.63 million barrels per day.
The EIA raised its prediction for Russian oil production in 2023 by 400,000 barrels per day, despite EIA forecasting that the actual decline in Russian oil production in March would be greater than the country's previously announced cuts.
The EIA also raised its forecast for US gasoline consumption in 2023 and 2024 by about 2% from last month's forecast.
Regarding the outlook for oil prices, EIA expects Brent crude oil prices to be $82.95/barrel in 2023 and $77.57/barrel in 2024.
In the Asian trading session on Wednesday, international oil prices rose slightly, and the prices of Brent crude oil futures hovered above $83/barrel. Affected by factors such as Fed Chairman Powell's speech that heightened rate hike concerns and the strengthening of the US dollar, international oil prices fell by $3/barrel on Tuesday.
China to be a key driver of global oil consumption
EIA said that with the change in China's COVID-19 prevention policy, the country is expected to be the main driver of global oil demand in 2023.
The agency expects global liquid fuel consumption to add by 1.5 million barrels per day in 2023 compared to 2022, and by another 1.8 million barrels per day in 2024.
EIA also expects China's liquid fuel consumption to grow by 700,000 barrels per day in 2023, accounting for about half of this year's global increase.
The Secretary-General of the OPEC also expressed optimism on China's oil demand outlook on Tuesday. As the world's largest crude oil importer, China's oil demand will balloon by 500,000 barrels per day to 600,000 barrels per day in 2023, the Secretary-General said.
He also said OPEC expects global oil demand to rise by 2.3 million barrels per day in 2023.