Dallas Fed: U.S. Output Seen Rising on Iran War


   
Miguel E. Andujar
DTN Refined Fuels Market Reporter

   DAVENPORT, FL (DTN) -- U.S. oil executives expect domestic crude production 
to increase through 2026 and 2027 as the ongoing conflict involving Iran 
disrupts global supply flows and supports higher prices, according to a survey 
released Thursday (4/23) by the Federal Reserve Bank of Dallas.

   The survey, conducted between April 15--20, showed most executives 
anticipate modest production gains, with 43% expecting U.S. output to rise by 
up to 250,000 bpd in 2026. For 2027, the largest share of respondents, 32%, see 
production increasing between 250,000 bpd and 500,000 bpd.

   Executives also expect disruptions tied to the Strait of Hormuz to persist 
in the near term. Only 20% of respondents said traffic would return to normal 
by May, while 39% expect normalization by August and 26% by November.

   Looking further out, geopolitical risk remains elevated, with 48% of 
respondents saying future disruptions to the Strait are "very likely" within 
the next five years and another 38% viewing them as "somewhat likely."

   Executives also expect higher structural costs tied to the disruption, with 
the most common response indicating shipping costs from the Persian Gulf could 
increase by more than $2 bbl but not more than $4 bbl once the conflict ends.




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