Lots of New Data Today from the EIA. Key Points Already Covered
in news and newswire stories. My comment would be I just don't see how we're going to produce 86.5 Mb/day in 2007, which is the average global demand now projected by the EIA. Interestingly, EIA admits they have no satisfactory answer for this either, given their forecast that they see no notable rise in aggregate OPEC production. If I read EIA correctly from the today's newly released STEO (short-term energy outlook) report, they are taking a Hail Mary and saying the gap between the new demand high of 86.5 Mb/day in 2007 and the predicted production shortfall will come (maybe) from Non-OPEC, and, current inventories. Inventories? Inventories? Yikes.
Today's STEO:
eia.doe.gov
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Global Petroleum Markets
Organization of Petroleum Exporting Countries (OPEC). In response to rising oil inventories and declining world oil prices, OPEC agreed to hold an emergency meeting on October 18 to discuss an oil production quota cut. EIA projects that actual production cuts by OPEC as a group will be less than stated because OPEC quota cuts are prorated among its members based on previous quota levels, and several of its members have experienced production difficulties and are already producing below existing quota levels. However, a projected increase in world oil demand growth in 2007 is expected to result in an increase in the demand for OPEC oil. As a result, average OPEC crude oil production for 2007 is expected to be at current levels.
Surplus world crude oil production capacity, all of which is located in Saudi Arabia, is expected to increase only slightly in 2007 (World Oil Surplus Production Capacity). As a result, surplus world oil production capacity is projected to remain near 30-year lows.
Non-OPEC Supply. The increase in demand growth will be partially met by new supplies from non-OPEC countries. The net annual growth in non-OPEC oil production for 2006 will likely total around 0.7 million barrels per day (bbl/d) (Growth in World Consumption and Non-OPEC Production). Although production will be limited at first, Russia’s Sakhalin I Project and the United Kingdom’s Buzzard field should begin adding new supply during the fourth quarter. Growth in 2007 non-OPEC production likely will rise to 1.2 million bbl/d (International Oil Supply Charts), as new projects in the Caspian Region, Africa, and Brazil are expected to add more than 0.9 million bbl/d of new production.
Inventories. Inventories and increases in OPEC supplies are expected to meet the rest of the projected demand growth. World oil inventories increased in Organization for Economic Cooperation and Development (OECD) countries during the first half of 2006 as concerns about potential supply problems rose. However, EIA projects that OECD inventories will tighten during the fourth quarter of 2006 in response to a reduction in OPEC crude oil production. By the end of 2007, EIA projects days of supply of OECD inventories to finish at the bottom of the normal range for that time of year, which is expected to make the market even tighter.
Demand. Despite prevailing high prices, world petroleum consumption is projected to grow by 1.2 million bbl/d in 2006, and by 1.5 million bbl/d in 2007 (World Oil Consumption Growth). Demand growth in the United States is expected to rise from no annual growth in 2006 to 0.4 million bbl/d in 2007. The United States and China are projected to account for over half of worldwide growth in oil demand in 2007. Demand growth is also projected to be strong in the oil-exporting countries of the Middle East, which are benefiting from their current high oil revenues. However, these global oil demand projections reflect a downward revision for the third consecutive Outlook in response to slower-than-expected demand growth in the OECD countries.
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Finally, EIA released latest updates on Global Reserve Estimates on OCT 05, 2006. (The Excel spreadsheet version is easiest to read.) Nota Bene footnotes on estimates of Canadian Reserves and how differing groups handle Oil Sands reserves estimates.
Acessible from this page, about halfway down page at Entry titled "World Proved Reserves of Oil and Natural Gas, Most Recent Estimates (10/05/2006)":
tonto.eia.doe.gov
Gregor |
