IEA: oil price volatility to rise in 2017. The uncertainty surrounding OPEC production cuts coupled with the rebound in U.S. shale, which could push oil prices down again, will ultimately lead to much more volatility this year. That comes from the IEA’s executive director Fatih Birol. “I would expect that we will see a rebalancing of the markets within the first half of this year,” he said over the weekend, according to Reuters. “But what I want to say (is) that we are entering a period of much more volatility in the market ... the name of the game is volatility.” He also warned about a supply shortfall towards the end of the decade if the oil industry does not substantially increase upstream investments from multi-year lows seen last year. “This year, if there are no major investments coming we may well see in a few years from now significant supply-demand gap with serious implications on the market,” he warned.
IEA: no peak oil demand anytime soon.
The IEA’s executive director Fatih Birol took to twitter to dismiss notions that global oil demand will peak anytime soon. The IEA sees rapid growth in oil consumption in several sectors over the next several decades that will offset any savings from the growth in electric vehicles. Oil consumption in aviation, petrochemicals, freight and maritime transit will overwhelm the efficiency gains in passenger vehicles, the agency predicts.
Demand for hydrocarbon based liquid fuels, primarily from crude oil, will reach 100,000,000 barrels per day by 2019, a year earlier than forecast just a few years ago.
MY TAKE: A lot is made of the high global inventories. When you consider how much oil based products this world depends on each day, doesn't it make sense that we have higher inventories?
They call them cycles for a reason
They call them cycles for a reason
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group