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The U.S. is exporting crude oil at a record pace with no signs of slowing down. a situation that may unhinge a global oil market in recovery. according to Tom Kloza.
`The exports are what we need to focus on through the next 30 days.` Kloza. co-founder and current global head of Energy Analysis at Oil Price Information Service (OPIS). told CNBC`s `Futures Now` last Friday .
High U.S. production could decide how oil prices trade in the second half of 2018. and through 2019. he added.
U.S. crude oil exports rose to 2.175 million barrels per day (MMBPD). or more than 15 million barrels (MMBbl) a week. at the end of March – the highest level on record.
`We think that number is going to go up to probably 20 million or more (a week). get to maybe 2.5 MMBPD.` Kloza said. `The U.S. is. in essence. going to be exporting more than the United Arab Emirates. Kuwait. Nigeria. those individual countries.`
Domestic exports have not dipped below 1 million barrels a day since late November. as U.S. oil producers fill the void left by reduced capacity from Mexico and Venezuela.
Higher demand for petroleum and gasoline in South America has also boosted the appetite for North American oil.
Rising U.S. production and exports comes at a time when other oil producers are ramping up their own activity. said Kloza.
Russia recently had `the highest output in about 11 months and there are some hints that maybe they`re not going to be in this long-term supply cutting agreement with the Saudis.` said Kloza. On top of that. `we`re going to see higher production from Kazakhstan. from Brazil. from the U.S.. and from Canada.`
Political events and international relations could bring drastic moves to the market come summer. according to Kloza. He sees the upcoming Iraqi and Venezuelan elections in May and `superhawks` John Bolton (as National Security Advisor) and Mike Pompeo (as U.S. Secretary of State) coming into the White House as possible market movers.
Kloza forecasts an average of $67 Bbl for Brent crude oil this year. where it currently is trading.
