October 22, 2019 / 10:19 AM / a month ago

Russia's Novak says U.S. oil output to peak in next few years

FILE PHOTO: Russian Energy Minister Alexander Novak attends the Energy Week International Forum in Moscow, Russia October 3, 2019. REUTERS/Evgenia Novozhenina/File Photo

SOCHI, Russia (Reuters) - U.S. oil production is likely to peak in the next few years as current petroleum prices are capping the pace of expansion, Russian Energy Minister Alexander Novak said on Tuesday.

The brisk pace of U.S. production, now the world’s largest, in the past few years has been a key factor behind the relative weakness in oil prices. Output has slowed recently, however.

“We are seeing declining activity in U.S. shale oil production. Though there have been gains, these are lower than in previous years ... This is a trend,” Novak told reporters.

Goldman Sachs has wound back its forecast for growth in U.S. shale oil output in 2020, and trimmed its outlook for growth in global oil demand next year.

“It is likely that in the near future, if the forecasts come to fruition, we will see a plateau in (U.S. oil) production within the next few years,” Novak said.

The Organization of the Petroleum Exporting Countries, Russia and other producers, an alliance known as OPEC+, have since January implemented a deal to cut oil output by 1.2 million barrels per day to support the market.

Reporting by Darya Korsunskaya; Writing by Vladimir Soldatkin; Editing by Edmund Blair and Dale Hudson

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