Oil prices extend losses amid supply glut

The previously forecasted price was $56 per barrel in 2016 for Brent, and WTI price – at $51 a barrel in 2016.

WTI price will average $38.54 a barrel in 2016 and $47 a barrel in 2017, according to the EIA’s forecasts.

The West Texas Intermediate for February delivery moved down 97 cents to settle at 30.44 dollars a barrel on the New York Mercantile Exchange, while Brent crude for February delivery decreased 69 cents to close at 30.86 dollars a barrel on the London ICE Futures Exchange. With the sharp losses, US crude futures fell below $30 a barrel for the first time since December, 2003.

The Central Appalachian region saw a 22 percent price dip at the same time that its production dropped by 40 percent, compared with the 2010-2014 average, EIA said.

The US Energy Information Administration (EIA) forecasts the growth of the world supply of oil and other liquid hydrocarbons up to 95.93 million barrels per day in 2016, the EIA January short-term forecast said. While a considerable draw has generally provided upside pressure for crude prices in recent months, inventories are typically drawn down in the final weeks of the year as companies look to avoid year-end tax burdens. Analysts surveyed by The Wall Street Journal had predicted supplies would rise by 2.1 million barrels on the week.

Refinery crude runs fell by 194,000 barrels per day, EIA data showed.

USA coal exports also declined in 2015, especially to major coal export destinations such as Europe and China. So, gasoline prices are expected to remain lower for longer. The index remains near 12-month highs from December, when it eclipsed 100.00.