IEA: Price Spike Coming In 2020

Discussion in 'Business and Economics' started by Carcus, Sep 20, 2017.

  1. Carcus

    Carcus Well-Known Member

    "The problem of a shortage of supply seems very far off today, given the swift turnaround in U.S. shale and persistently high levels of crude storage.


    But demand continues to rise—the IEA just upgraded its demand growth estimate for 2017 to 1.6 million barrels per day (mb/d). If that level of demand growth continues for a few years, it will more than devour the excess supply on the market. Even a more tempered growth rate would strain supplies toward the end of the decade, absent a corresponding uptick in production.

    “There are still not enough signs of investment beginning to return, and that raises the risk of tightening of the market in the next five years and a risk to the stability of oil prices,” Neil Atkinson, head of the IEA’s oil markets and industry division, said at a conference in Bahrain. “There is at least a possibility of going back to the situation we had 10 years ago where oil prices were very, very high at a time when demand was growing.”"

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    "In a 2016 report, the IEA estimated that the industry would need to bring online an additional 21 mb/d of new supply by 2025 just to keep current production flat, after factoring in depletion rates from existing projects plus higher demand levels."

    http://oilprice.com/Energy/Energy-General/IEA-Price-Spike-Coming-in-2020.html

    Low Oil Prices Lead To Fastest Mature Fields Decline In 25 Years
    http://oilprice.com/Energy/Oil-Pric...astest-Mature-Fields-Decline-In-25-Years.html
     
    Last edited: Sep 20, 2017
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  2. ALS

    ALS Super Moderator Staff Member

    We'll see on that one. All my life I've heard the same stories and and not once have they come true. With the changes coming to the automobile industry and I use England and France as an example as they want to eliminate the sale of gasoline and diesel automobiles in the next two decades. Things are changing and these stories show how small minded the authors are. All we've heard for the last thirty to forty years of how we're going to see peak oil by this date and that date and not once did any of these prophecies ever come true.

    http://money.cnn.com/2017/09/11/autos/countries-banning-diesel-gas-cars/index.html
     
  3. Carcus

    Carcus Well-Known Member

    What I posted isn't about peak oil. It's about the end of "cheap" oil.

    You'd be hard pressed to find an analyst who doesn't think oil is going higher over the next 5 years. -- and (unlike a few years ago) most of them are talking about the impact (or lack thereof) from electric vehicles and increased fuel efficiency.
     
    kbergene likes this.
  4. ALS

    ALS Super Moderator Staff Member

    Do I see $60 oil, yes we might even see $75 a barrel for oil, but the days of $100 a barrel are over for a generation.

    Like the idiots in my state Government can't balance the budget but had no problem raising the speed limits on the Turnpike and almost all the interstates to 70 mph. It's all about increasing the gasoline tax revenue not convenience of the higher speeds for the residents of the state. I drove up to Watkins Glen on the 3rd and almost no one was driving over 65 mph on sections of the interstates with 70 mph speed limits. That change hasn't work out for the state the way they wanted it to.

    What people don't realize is most of the mandated efficiency gains aren't for saving fuel but more of a strategic starving off the income of our political enemies.

    Most of the oil producers have pretty high government costs due to social programs as well as oil exports are their main source of income for the country, think Middle East, Venezuela, Russia.

    Most of the funding for many of the Anti-Fracking groups here and in the E.U. have been traced directly back to Saudi Arabia.

    The Fracking Genie is out of the bottle as they say and western Europe is just getting on the oil and gas drilling bandwagon.

    I have a member on another board that has several wells he drilled in Texas in the last two years and his costs are under $30 per barrel and WTI is trading today around $50.73.

    Do you think he's complaining making over $20 per barrel profit.

    Most of the costs of drilling have come down across the board due to major technology advances in the last five years of so.

    When the five of the biggest and or growing economies are looking at dramatically cutting their oil usage, these rogue oil producing countries are in big trouble.

    The U.S., China, E.U., Briton and India have all announced major government objectives to cut their oil use dramatically over the next few decades.
     
    Carcus likes this.
  5. Carcus

    Carcus Well-Known Member

  6. Carcus

    Carcus Well-Known Member

    I don't doubt there are operators (some, not all) in west Texas making good money at $50/barrel. But Texas shale or even US shale isn't nearly enough to make up for World demand growth and World decline rates.

    Duplicating the US shale revolution in most other parts of the world is going to be very difficult. The US has a lot of unique features which allowed the shale boom to happen here which most other places in the world are lacking.

    I think most of the sizable supply potential lies in (expensive) offshore projects and tar sands.

    http://economictimes.indiatimes.com...vestors-already-have/articleshow/60885524.cms
     
    Last edited: Sep 29, 2017
  7. PaleMelanesian

    PaleMelanesian Beat the System Staff Member

    I read the title wrong. I thought this was about prices on Swedish furniture. :p
     
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  8. Carcus

    Carcus Well-Known Member

    I now exactly what your taling about!
     
    BillLin likes this.
  9. Carcus

    Carcus Well-Known Member

    China Study Warns Of Impending Oil Production Peak & World Oil Market Squeeze, + Peak Recoverable Coal ~2020

    "China is rapidly approaching peak fossil fuel extraction according to a new state-funded study led by the China University of Petroleum in Beijing.

    The study findings include the assertion that China will experience a peak in its total oil production (conventional + unconventional) by as early as 2018. As a result, world oil markets and geopolitics are likely to be greatly affected as China seeks to meet the widening demand shortfall through trade."

    "The new study was published in the September 19th edition of Springer’s peer-reviewed Petroleum Science journal. Financial support was provided by all three of China’s major oil firms: the China National Petroleum Corporation (CNPC), China Petroleum Corporation (Sinopec), and China National Offshore Oil Corporation (CNOOC)."

    https://cleantechnica.com/2017/10/0...il-market-squeeze-peak-recoverable-coal-2020/

    /China is the world's largest importer of oil, ... kind of difficult to imagine that they'd be pushing the "world oil market squeeze" angle if they didn't think it was real.

    https://en.wikipedia.org/wiki/Chinese_aircraft_carrier_programme
     

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