[Graeme]

Peak oil review - Jun 2

As predicted last Wednesday, US crude stocks rebounded on revived crude imports which were up by 1.3 million b/d leading to a 1.7 million barrel increase in US stockpiles. For those keeping book, the 1.7 million barrel increase was about half way between the 100,000 barrels the Wall Street Journal’s consultants were predicting and the 3.7 million the API’s survey came up with. The increase in stocks, mixed news about the US economy, and a softening of the rhetoric over the Ukrainian situation sent oil prices downwards last week with NY futures settling at $102.71 and London’s Brent at $109.41. Supplies at Cushing, Okla. fell by 1.58 million barrels to their lowest since 2008. Stocks there are getting close to the minimum operating level which is thought to be around 20 million barrels.


A preliminary estimate says OPEC crude production grew by 75,000 b/d in May to just shy of 30 million b/d. Saudi and Angolan production increased while Iranian, Nigerian, and Libyan production slumped. The IEA is still saying that OPEC must increase production by another 700,000 b/d during the second half of 2014 or the world will see higher prices.

resilience

[Graeme]

IEA Expects World to Rely More on Middle East Oil

A top energy watchdog said the world will need more Middle Eastern oil in the next decade, as the current U.S. boom wanes. But the International Energy Agency warned that Persian Gulf producers may still fail to fill the gap, risking higher oil prices.

In its first update to the agency's energy investment outlook in more than a decade, the IEA—which represents some of the world's largest consumer nations—said it sees "growth in oil demand [becoming] steadily more reliant on investment in the Middle East."

Surging American production from tight oil—extracted from shale formations in places like Texas and North Dakota—has led the agency and other oil-market analysts to predict the U.S. could leapfrog the world's largest oil producers, Saudi Arabia and Russia, by 2020. That has triggered debate in Washington about easing a long-standing ban on most crude exports from American shores. It has also engendered hope of more energy security for the U.S., as well as worry that if American reliance on Mideast oil lessens, so might its military and diplomatic engagement in the region.

In its report, a summary of which was released early Tuesday in London, the IEA predicts that "output from North America plateaus [from around 2020] and then falls back from the mid-2020s onwards." That forecast is broadly consistent with studies by the Organization of the Petroleum Exporting Countries, a cartel of some of the world's largest producers.

wsj

[Paulo1]

Time for another Pivot......after 2016?

[Subjectivist]

IEA Expects World to Rely More on Middle East Oil

A top energy watchdog said the world will need more Middle Eastern oil in the next decade, as the current U.S. boom wanes. But the International Energy Agency warned that Persian Gulf producers may still fail to fill the gap, risking higher oil prices.

In its first update to the agency's energy investment outlook in more than a decade, the IEA—which represents some of the world's largest consumer nations—said it sees "growth in oil demand [becoming] steadily more reliant on investment in the Middle East."

Surging American production from tight oil—extracted from shale formations in places like Texas and North Dakota—has led the agency and other oil-market analysts to predict the U.S. could leapfrog the world's largest oil producers, Saudi Arabia and Russia, by 2020. That has triggered debate in Washington about easing a long-standing ban on most crude exports from American shores. It has also engendered hope of more energy security for the U.S., as well as worry that if American reliance on Mideast oil lessens, so might its military and diplomatic engagement in the region.

In its report, a summary of which was released early Tuesday in London, the IEA predicts that "output from North America plateaus [from around 2020] and then falls back from the mid-2020s onwards." That forecast is broadly consistent with studies by the Organization of the Petroleum Exporting Countries, a cartel of some of the world's largest producers.

wsj

They have been predicting this for decades, but I have yet to see any evidence it will be turning out that way.