Crude output drops 3% on year in April, below official forecast
Norway’s crude oil output was down 3% on the year in April at 1.66 million b/d, data published May 20 showed, with output running well below official forecasts due to sooner-than-expected maintenance.
April crude output was also down nearly 5% compared with March 2022. Overall liquids production, including natural gas liquids, was down 6% on the year at 1.87 million b/d.
The drop in liquids production came despite a near-5% increase in gas production in April compared with a year earlier, to 327 million cu m/d. Some producers have prioritized Europe’s gas market, diverting gas to market that would normally be reinjected to support oil production.
April’s crude output was nearly 11% below the Norwegian Petroleum Directorate’s forecast, which was for no drop. The NPD had forecast a fall in production in May and further fall in June, likely due to maintenance.
However, state-controlled Equinor had flagged maintenance lasting a month in April-May at a number of fields that contribute to the Troll crude blend, part of the Platts Dated Brent benchmark.
Dated Brent was assessed at $111.35/b on May 19. Dated Brent spiked to nearly $138/b on March 8 on the back of the Ukraine invasion and disruption to Russian flows.
Norway anticipates a big boost to its crude output when the second phase of the Johan Sverdrup development comes on stream in the fourth quarter 2022, intended to lift Sverdrup output from 535,000 b/d to 755,000 b/d.
The NPD forecast crude output in 2022 to average 1.79 million b/d, up from 1.76 million b/d in 2021. Analysts at S&P Global Commodity Insights expect a more significant jump, to 1.88 million b/d of crude this year.