The US vs Saudi Arabia, oil production
Posted: Thu 13 Dec 2012, 11:17:52
Came across this article in Bloomberg this morning....really worth a read as it discusses a lot of the problems the Saudis face going forward in delivering both energy and social programs at home and how that impacts the price of oil they require (we discussed this issue on another thread). Some of it is misleading I think but judge for yourself
http://www.bloomberg.com/news/2012-12-12/oil-at-60-or-120-doesn-t-prevent-u-s-supplanting-saudi-arabia.html
this quote from the article suggests they don't understand supply and demand to my mind
So they are saying that US production will continue to rise and that so will WTI? Makes no sense to me given there is already a large gap between WTI and Brent and more US production should just increase that gap unless the US suddenly starts exporting large quantities of oil which of course defeats the purpose of being "energy independant".
http://www.bloomberg.com/news/2012-12-12/oil-at-60-or-120-doesn-t-prevent-u-s-supplanting-saudi-arabia.html
this quote from the article suggests they don't understand supply and demand to my mind
U.S. average daily output will climb 14 percent this year, the most in six decades, according to the Energy Department, as Anadarko Petroleum Corp. and Chesapeake Energy Corp. exploit new deposits from North Dakota to Texas. Even though America’s 6.8 million barrels a day in November was 30 percent less than Saudi Arabia’s 9.7 million, the International Energy Agency says the U.S. will be bigger by 2020.
West Texas Intermediate, or WTI, will rise about 15 percent through 2015, to $100 a barrel, according to the median of 13 analyst estimates compiled by Bloomberg. Brent, the benchmark for Arab Light and Arab Medium grades, may gain less than 1 percent, to $110, the forecasts show.
So they are saying that US production will continue to rise and that so will WTI? Makes no sense to me given there is already a large gap between WTI and Brent and more US production should just increase that gap unless the US suddenly starts exporting large quantities of oil which of course defeats the purpose of being "energy independant".