The Energy Information Administration (EIA) released their March Short-Term Energy Outlook this week. I have select data organized below. Current crude oil prices are expected to remain in the $55/barrel range this year before rising in 2016. The only noteworthy estimation change in the last two months is that 2015 U.S. crude oil production is increased 2016 production is cut.
- Stock Market Performance declines 5% from current levels and stays there for 2015 and 2016 due to fears that Feds will increase interest rates, a sluggish global economy, and a growing U.S. economy.
- Oil Prices move down to $30/barrel in 2015 and rise back to $50/barrel in 2016. This assumes that lower oil price is necessary to reduce crude oil supply and that $50/barrel is here to stay for 2016 as increases in prices will incentivize idled rigs to resume production.
- Crude Oil and Petroleum Product Production return to June 2014 levels in 2015 (a drop of approximately 6%) but bounces back at EIA's 2015 growth rate for 2016 The production drop in 2015 due to oil's price drop(point 2) will allow excess crude oil inventories to be refined.