Opec and non-Opec members are expected to agree on an extension to a global supply cut during a meeting in Vienna next week. On Monday, Saudi Arabia and Russia, the world's top two oil producers, backed an extension for a further nine months until March 2018 to rein in a global crude glut.
However, analysts have said that the higher US shale production may be a challenge to global rebalancing efforts. In the Permian play located in West Texas and New Mexico, oil production is expected to rise by 71,000 bpd to a record 2.49 million bpd. In the Eagle Ford region, located in South Texas, output is set to rise by 36,000 bpd to 1.28 million bpd, the most since April 2016. Production in the Bakken play in North Dakota is forecast to rise 5,800 bpd to 1.03 million bpd, its second monthly rise.
US natural gas production was projected to increase to a record 51.3 billion cubic feet per day (bcfd) in June. That would be up almost 0.6 bcfd from May and be the eighth monthly increase in a row. The EIA projected gas output would increase in all of the big shale basins in June. Output in the Marcellus formation in Pennsylvania and West Virginia, the biggest shale gas play, was set to edge up to a record high near 19.3 bcfd in June, an eighth consecutive increase. Production in the Marcellus was 18.0 bcfd in the same month a year ago. EIA also said producers drilled 941 wells and completed 754 in the biggest shale basins in April, leaving total drilled but uncompleted wells (DUCs) up 187 at a record high 5,721, according to data going back to December 2013.