IEA's Oil Market Report - Comments

[dan_s]

I was surprised by several of the forecasts made by IEA in their monthly "Oil Market Report". I'm not the only one.

Dr. A. Alhaggi at the OGEL Forum ( https://www.ogel.org/ogelforum.asp ) wrote this.

In my view, The IEA is over-estimating US shale production growth. Once you add the additions to the amount needed to replace declines, you realize the huge amount needed of fresh oil to meet forecast. < I agree that most analysts don't seem to take the steep decline curves into consideration. - Dan

My problem with the IEA outlook that was released yesterday is the message it is sending to OPEC and other major oil producers. The embedded message: no additional investment is needed to expand production capacity. Based on my modeling of the oil market and the transportation sector concludes that both US oil production and electric vehicles on the road are hyped. If oil producers believe the hype, we are heading for an energy crisis. < We will be well into the 2020s before EVs are 10% of the global fleet. - Dan

The IEA claims that these are not forecasts or projections, they are "scenarios". After a careful review, I concluded: the IEA outlook is a wish list or some sort of guidance to governments and organizations.

In the IEA monthly oil report: the oil market will remain oversupplied in the first half of 2018, yet it doubled its non-OPEC production, with most of the increase coming from the US! We have already seen slower growth in the US in recent months, why the doubling from previous forecasts? Also, their view contradicts recent development and some of the best forecasts in the industry.
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Profile
Dr. Anas F. Alhajji is a Managing Partner at Energy Outlook Advisors and the former Chief Economist of NGP Energy Capital Management. He led the Firm's macro-analysis of the oil, natural gas and related markets as well as the overall economic environment. He was responsible for the short-term and long term outlooks for oil, natural gas, NGLs, and LNG markets.

Dr. Alhajji is a highly respected academician, author, researcher, and speaker with more than 800 papers, articles and columns to his credit, with focus on energy markets outlook, energy security, and oil geopolitics. His articles have appeared in numerous countries in more than 10 languages, and his work is cited in over 60 books. He has addressed various national and international organizations, institutions and conferences. He also serves on the board of several energy-related publications.

He is a contributing editor for the one of the industry's premier publications: World Oil. He is also the moderator of the industry's oldest virtual Forum: Oil, Gas, & Energy Law (OGEL).

Prior to joining NGP, Dr. Alhajji served as a professor of economics at the University of Oklahoma (1995 to 1997), the Colorado School of Mines (1997 to 2001), and Ohio Northern University (2001 to 2008), where he held the George Patton Chair of Business and Economics. Dr. Alhajji taught courses in economics, energy economics and policy, and energy geopolitics.

Dr. Alhajji was educated in Syria, Saudi Arabia, and the United States. He holds M.A. in Economics, and a Ph.D. in Economics from the University of Oklahoma, with a specialization in energy economics and policy. He received many awards including the Teaching Excellence Award and the Outstanding Mentor Award in addition to many prizes in woodworking.