US Energy Information Administration

The confluence of a pandemic, a price war, and extreme weather sent the US production engine into reverse last year, marking the largest annual drop in output on record. New figures on the decline come as the market senses higher oil prices coming.

This year gas is expected to look only a bit better, but after 2019 that is a relief.

The good news for next year is no one is predicting a repeat of what happened this year. The bad news is the outlooks offers little incentive to find any more oil.

The drop in US LNG exports comes amid a combination of weak demand, ample supply, additional capacity coming on line, and flexibility to cancel US cargoes.

The recent increase in global liquid fuel inventory has been largely driven by travel restrictions, and reduced economic activity. Supply is expected come back down as demand and prices recover.

US energy-related carbon dioxide emissions declined by 2.8% in 2019 to 5,130 million metric tons, according to data in the US Energy Information Administration’s Monthly Energy Review. Carbon dioxide emissions had increased by 2.9% in 2018, the only annual increase in the past 5 years.

Nymex WTI crude opened Monday on track for its worst day on record, falling nearly 40% to $11.05/bbl on the back of excess supply vs. low demand and dwindling storage capacity.

Led by Texas and New Mexico, year-over-year crude output jumped by 11% according to the US Energy Information Administration. Going forward, new records will be set but at a slower pace.

While renewable energy sources are poised to see major growth, possibly displacing natural gas as the top source of electricity in the US, hydrocarbon production will remain above or near current historical highs until at least 2050.

Proved oil reserves totaled 43.8 billion bbl at yearend 2018 while proved gas reserves amounted to 504.5 Tcf, both topping records set in 2017, the US Energy Information Administration said.