U.S. petroleum and other liquids production is expected to grow by 10% from 2022 through 2050, driven by international demand and higher exports of finished products, according to the Reference case in the recent Annual Energy Outlook 2023 (AEO2023) by the U.S. Energy Information Administration.
The Reference case is the benchmark case in the outlook and reflects laws and regulations adopted through the middle of November 2022 but assumes no new laws or regulations in the future. The Reference case is also based on the assumption that Brent Crude oil prices will reach $101 per barrel in 2022 dollars by 2050.
The EIA sees modest growth in America’s production of petroleum and other liquids through 2050, increasing about 10% from last year.
The other cases – which include a High Oil and Gas Supply case, a Low Oil and Gas Supply case, a High Oil Price case, and a Low Oil Price case – show a wide range of production levels based on different assumptions for oil prices and ultimate recovery per well for the shale patch in each case.
In the High Oil and Gas Supply case, U.S. petroleum and other liquids production could jump by 48% by 2050, while the Low Oil and Gas Supply case shows a 35% decline.
In the High Oil Price case, output is set to jump initially due to high prices, but production would start to fall after 2030 because of lower well productivity, the EIA said.
Eventually, this trend of fast-paced drilling would become unprofitable, at which point new drilling would stop, the administration reckons.
So even in the case of high oil prices, which assumes the price of Brent crude oil will reach $190 a barrel by 2050, U.S. production would decrease between 2030 and 2050, while the output between 2022 and 2050 would grow by 27%, much less than the 48% rise in the High Oil and Gas Supply case, according to the EIA.
By Tsvetana Paraskova for Oilprice.com
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