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IEA Sees No Oil Price Rebound For Years

Oil prices are likely to stay below $80 per barrel for another five years, according to a closely watched energy report. The International Energy Agency released its 2015 World Energy Outlook (WEO), with predictions for energy markets out to 2040. Although there are no shortage of caveats, the IEA projects that oil prices will only rebound slowly and intermittently, and the supply overhang will slowly ease through the rest of the decade. In its “central” scenario, it sees oil prices rebalancing in 2020 at $80 per barrel, with increases in the years following. At issue, as always, is supply and demand dynamics. The IEA estimates that the oil industry will slash upstream investment by 20 percent in 2015, which will cut into long-term supply figures. Non-OPEC supply will peak before 2020 as a result of much lower investment, topping off at 55 million barrels per day. U.S. shale will […]

Posted On : Published By : Tom Whipple
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IEA Says Record 3 Billion-Barrel Oil Stocks May Weaken Prices

Oil stockpiles have swollen to a record of almost 3 billion barrels because of strong production in OPEC and elsewhere, potentially deepening the rout in prices, according to the International Energy Agency. This “massive cushion has inflated” on record supplies from Iraq, Russia and Saudi Arabia, even as world fuel demand grows at the fastest pace in five years, the agency said. Still, the IEA predicts that supplies outside the Organization of Petroleum Exporting Countries will decline next year by the most since 1992 as low crude prices take their toll on the U.S. shale oil industry. “Brimming crude oil stocks” offer “an unprecedented buffer against geopolitical shocks or unexpected supply disruptions,” the Paris-based agency said in its monthly market report. With supplies of winter fuels also plentiful, “oil-market bears may choose not to hibernate.” Oil prices have lost about 40 percent in the past year as the OPEC […]

Posted On : Published By : Tom Whipple
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Oil Market Report

mb/d World Oil Demand *Please note that these Highlights are from the latest Oil Market Report, which is released in full to subscribers only – according to this schedule each month . Non subscribers get free access to the latest Highlights on this schedule, however the full Oil Market Report is released to the public two weeks after the report is released to subscribers. If you would like to receive the full report with accompanying charts and graphs on the day of publication please subscribe or contact the subscription manager . Crude oil benchmarks were locked in a narrow range during October as continuing oversupply in world markets and a strong US dollar limited the impact of strikes in Brazil and geopolitical tensions. At the time of writing, ICE Brent was trading at $44.43/bbl and NYMEX WTI at $41.75/bbl. Global demand growth is forecast to slow to 1.2 mb/d […]

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Global Oil Demand Growth to Slow in 2016, IEA Says

Workers connect drill bits and drill collars in the Permian basin outside of Midland, Texas…. Global oil demand will ease next year on the weaker outlook for the world economy and oversupply in the market, the International Energy Agency said on Friday. The IEA said global demand growth is forecast to slow to 1.2 million barrels a day in 2016 after surging to 1.8 million barrels a day this year. Economic conditions are expected to remain problematic in countries such as China, and factors that have recently fuelled consumption are expected to fade, it said. Commercial stocks from countries in the Organization for Economic Cooperation and Development stood at a record near 3 billion barrels by the end of September, even as the global oil market adjusts to oil trading at $50 a barrel oil. “The net result is brimming crude oil stocks that offer an unprecedented buffer against […]

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OPEC Says Oil-Inventory Glut Is Biggest in at Least a Decade

Surplus oil inventories are at the highest level in at least a decade because of increased global production, according to the Organization of Petroleum Exporting Countries. Stockpiles in developed economies are 210 million barrels higher than their five-year average, exceeding the glut that accumulated in early 2009 after the financial crisis, the organization said in a report. Slowing non-OPEC supply and rising demand for winter fuels could “help alleviate the current overhang,” enabling a recovery in prices, it said. The group’s own production slipped last month because of lower output in Iraq. “The build in global inventories is mainly the result of the increase in total supply outpacing growth in world oil demand,” OPEC’s Vienna-based research department said in its monthly market report. Oil prices have lost about 40 percent in the past year as several OPEC members pump near record levels to defend their market share against rivals […]

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OPEC sees oil surplus shrinking in 2016, but underlines current glut

The logo of the Organization of the Petroleum Exporting Countries (OPEC) is pictured at its headquarters in Vienna, Austria, August 21, 2015. OPEC said its oil output fell in October and forecast supply from rival producers next year would decline for the first time since 2007 as low prices prompt investment cuts, reducing a global supply glut. In a monthly report, the Organization of the Petroleum Exporting Countries said it pumped 31.38 million barrels per day (bpd) last month, down 256,000 bpd from September. That is the first decline since March, according to OPEC figures. The forecast of a decline in supply outside OPEC, if realized, would be a further indication the group’s strategy is working. OPEC last year abandoned a longstanding policy of propping up prices and instead raised output, seeking to recover market share taken by higher-cost rival production. Oil is trading at around $45 a barrel, […]

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OPEC Oil Output Falls on Iraqi Export Woes

OPEC’s output dropped sharply in October. A sharp drop in Iraqi oil production has driven OPEC’s overall output down, as the seemingly relentless ascent of the country’s energy industry started feeling the strain from security problems and insufficient investments. Iraq’s production fell by 195,400 barrels a day in October to just over 4 million barrels a day. The overall output is still near record highs for Iraq, but the steep monthly drop offered fresh evidence that the country’s surprising ramp up over the past year—when oil prices plunged—may not be sustainable. “In a low-price environment, we are approaching peak capacity from Iraq,” Olivier Jakob, head of Swiss oil consultancy Petromatrix, said in a note Thursday. Iraq’s decline was the largest in an overall output fall reported Thursday by the Organization of the Petroleum Exporting Countries in its closely watched monthly market report. The group produced 31.382 million barrels a […]

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OPEC Crude Production Down in October

OPEC has published their OPEC Monthly Oil Market Report with crude only production numbers for October 2015. The charts are “Crude Only” production and are in thousand barrels per day. OPEC 12 was down 256,000 bpd in October. Secondary Sources OPEC uses secondary sources such as Platts and other agencies to report their production numbers. I find these numbers far more useful than those reported by direct communication with the OPEC countries. Those numbers are political and usually highly inaccurate. Algeria peaked in November 2007 – 2008 and has been in a steady decline since that point. Angola has been holding steady since peaking in 2008 and 2010. Ecuador appears to have peaked this year. It is likely production will be down, but only slightly, next year. Iran appears to be poised to increase production when sanctions are lifted. But don’t expect too much very soon. After years of […]

Posted On : Published By : Tom Whipple