EIA Says U.S. Crude Oil Production To Rise By 1.02M Barrels/Day To 12.93M Barrels/Day In 2023 (Vs Previously Forecasted Rise Of 990,000 Barrels/Day)
Portfolio Pulse from Benzinga Newsdesk
The U.S. Energy Information Administration (EIA) has revised its forecast for U.S. crude oil production in 2023, now expecting an increase of 1.02 million barrels per day, reaching 12.93 million barrels per day. This is a slight uptick from the previously forecasted rise of 990,000 barrels per day.
December 12, 2023 | 5:28 pm
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NEGATIVE IMPACT
The United States Oil Fund LP (USO) is likely to be directly impacted by the EIA's updated forecast for U.S. crude oil production, as it tracks the daily price movements of West Texas Intermediate light, sweet crude oil.
The EIA's forecast suggests increased oil supply, which could put downward pressure on oil prices. As USO tracks the price of crude oil, an increase in production typically leads to a negative impact on the fund's price in the short term.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
The SPDR S&P 500 ETF Trust (SPY) may experience indirect impact due to the EIA's revised forecast for U.S. crude oil production, as energy sector performance is a component of the S&P 500 index.
While the EIA's forecast is specific to crude oil production, SPY, which tracks a broad range of sectors including energy, may see some indirect effects. However, the impact is likely to be diluted across the diverse holdings of the ETF.
CONFIDENCE 75
IMPORTANCE 40
RELEVANCE 50