"There's high hopes for what this Seaway pipeline will do for the WTI market, and that spread"
- John Kilduff of Again Capital
Oil production in the world's largest economy topped seven million barrels per day for the first time since March, 1993 and it is widely expected to jump by a quarter by 2014, the Energy Information Administration said Wednesday. Due to the discovery of vast reserves of shale oil, average global oil prices are likely to fall from $112 a barrel in 2012 to $99 in 2014. The report also showed that US oil imports would fall by a quarter between 2012 and 2014, because of the rising domestic production and the discovery of shale gas. However, the overall demand is expected to grow 0.3% to 18.71 million barrels per day in 2013, up from 18.65 million barrels a day in the previous year.
"There's high hopes for what this Seaway pipeline will do for the WTI market, and that spread. There's a lot of expectations around that right now," said John Kilduff of Again Capital.
"We were having trouble getting oil to market because of that bottleneck in Cushing, and that's one of the things that the pipeline is supposed to help," said Gene McGillian, analyst with Tradition Energy. "The idea that the spending cuts and the debt ceiling weren't dealt with keeps the market focused on economic issues."
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