Where Will the WTI Oil Price be at End 2022?
The West Texas Intermediate (WTI) crude oil price will be between US$70 per barrel and US$74.99 per barrel at the end of next year.
That was the most popular response in a poll asking where respondents expected the oil price to land at the end of 2022, which was included in the latest Dallas Fed Energy Survey released on the 29th December.
Executives from 132 oil and gas firms answered the question from the 8th to the 16th December, with WTI spot prices averaging US$71.43 per barrel during the period.
The second most popular answer in the poll came in at between US$75 per barrel and US$79.99 per barrel and the third most popular answer was between US$80 per barrel and US$84.99 per barrel.
The survey average was US$74.69 per barrel, with the low forecast coming in at US$50 per barrel and the high forecast at US$125 per barrel.
In addition to collecting oil price projection data, the Dallas Fed Energy Survey asked oil and gas firms a series of ‘special questions’, including one on what the expectations were for a company’s capital spending in 2022 versus 2021. According to the survey, most executives expect their firm’s capital spending to rise in 2022 compared with 2021.
Forty-four percent of executives said they expect capital spending to increase slightly, while an additional 31 percent anticipate a significant increase, the survey showed. Sixteen percent expect spending in 2022 to remain close to 2021 levels and eight percent expect reductions in spending in 2022.
The special questions segment also asked firms about their primary goal in 2022 while presenting them with eight potential goals comprising ‘grow production’, ‘maintain production’, ‘reduce debt’, ‘acquire assets’, ‘find additional sources of capital’, ‘divest assets’, ‘other’ and ‘reduce costs’.
Forty-nine percent of executives selected grow production as the primary goal in 2022, a total of 15 percent said maintain production and 13 percent said reduce debt, the survey showed.
Data for the special questions part of the Dallas Fed Energy Survey was also collected between the 8th and the 16th December and 131 oil and gas firms responded to this part of the survey.
The Dallas Fed conducts the Dallas Fed Energy Survey quarterly to obtain a timely assessment of energy activity among oil and gas firms located or headquartered in the Eleventh District, its website states.
The next survey is currently scheduled to be released on the 23rd March 2022.