U.S. shale oil output to drop 123,000 bpd to 7.69 million bpd in November: EIA

NEW YORK (Reuters) – U.S. shale oil output is expected to decline by 123,000 barrels per day (bpd) in November, the biggest drop since May, to about 7.69 million bpd, the U.S. Energy Information Administration (EIA) said in a monthly forecast on Tuesday.

Overall output is expected to drop for the third straight month and is expected to decline in most of the seven major shale formations in November.

The biggest decline is forecast in the Eagle Ford basin of South Texas, where production is estimated to drop by about 34,000 bpd to about 1 million bpd, the lowest since May 2013, the data showed.

U.S. oil and gas producers have slashed spending and curbed output this year as the global oil market grapples with a plunge in demand due to the coronavirus outbreak.

Still, U.S. energy firms last week added oil and natural gas rigs for a fourth week in a row for the first time since June 2018 as producers start drilling again with crude prices CLc1 holding around $40 a barrel over the past few months. [RIG/U]

In the Permian basin of Texas and New Mexico, the biggest shale oil basin in the country, output is expected to drop by 17,000 bpd to about 4.4 million bpd.

Separately, the EIA projected U.S. natural gas output would decline for a third month in a row to 81.8 billion cubic feet per day (bcfd) in November.

That would be down over 0.6 bcfd from its forecast for October. Output from the big shale fields hit a monthly all-time high of 86.9 bcfd in November.

Output in Appalachia, the biggest U.S. shale gas formation, was set to slip for a third month in a row in November to 33.6 bcfd, down over 0.1 bcfd from October.