EdwinSm wrote:The International Energy Agency (IEA) has predicted US oil output next year will see the steepest fall since 1992 thanks to low oil prices.
US oil production has increased to a record high in recent years as high prices made investment worthwhile.
Prices halved over the past year as demand fell in line with slower economic growth.
Meanwhile, Opec producers, particularly Saudi Arabia, have maintained high levels of production.
....
The IEA said the resulting lower oil prices would boost demand to a five-year high this year, a trend that the IEA said would help Opec countries.
Opec controls more than a third of the world's oil output. It typically cuts production when prices fall to attempt to push prices higher.
Its recent strategy has been to keep the taps turned on fully in an attempt to curb US output, which is uneconomical at lower prices.
The IEA said: "Oil's price collapse is closing down high-cost production from Eagle Ford in Texas to Russia and the North Sea, which may result in the loss next year of half a million barrels a day, the biggest decline in 24 years."
Non-Opec supply contracted by one million barrels a day in 1992 from the previous year after the Soviet Union broke apart.
The IEA expects US oil production to drop by 0.4 million barrels a day in 2016. It grew by 1.7 million barrels a day in 2014.
http://www.bbc.com/news/business-34219144
There is a lot of noise in all the data, but will this year be seen as the year of peak production?
The more I see some of this dated material from the IEA, and see how poorly their back of the envelope assumptions work out, and then recall that they fell for peak oil all the way back in 2006, only to be kicked in the teeth by reality later, the more I wonder if they aren't severely handicapped by their projection methods. There appears to be no structural modeling component, i.e. such as the EIA uses. So they just guess, get it wrong, guess some more, and it makes me wonder if Fatih brings too much old experience with him, and zero recognition of what the US has done, and how that will continue to affect the world.