Oil & Gas Market Update (Podcast) Aug 11
Oil & Gas Market Update (Podcast) Aug 11
Here is the link to the podcast: https://youtu.be/gRKoS7Yj8lw
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Market Update (Podcast) Aug 11
Here is a summary of the monthly Oil Market Report that was published on August 10.
From Investor Village with my takes in blue.
In a nutshell demand in 4th qtr. of 100.2mm bbl. p/d. Supply rose in July to 99.4mm bbl. p/d 1.1mm bbl. p/d above a year ago. < So, where will another 800,000 bbls per day come from? Answer: Inventories.
July was a month of relatively quiet geopolitics. Permian basin shale just reached the take away bottlenecks in July. Demand will grow by 1.5mm bbl. p/d in 2019. As SLB and others have stated there is over 3 yrs. of insufficient CAPEX. There are 15 oil producing countries with declining production. NOC's have had increasing demand on their revenues for their populaces. There is concern that the robust years of intense EOR in the world's legacy fields to keep production flat to up may lead to cliff like declines in some of these.
We will be drawing 800m bbl. p/d in the 4th qtr. from inventories. Demand will grow by 1.5mm bbl. p/d on average in 2019. Insufficient pipeline takeaway in the Permian which has been by far the leader in worldwide production growth will not be alleviated until late 2019. Canadian oil production, the 2nd. largest contributor to worldwide production growth has also been restricted by lack of pipeline capacity. Canadian producers have been relying on rail increases which has been hampered by lack of equipment.
Dependence on OPEC and Russia will increase in 2019. Brazil will add production which will be a help. It will be interesting to see what ROBEC can do or have we seen the GCC capacity during the market share wars? Barring a worldwide recession caused by trade tensions and/or banking issues oil prices will rise in 2019.
Not given much attention in the IEA report is the impact of sanctions and increased tensions between Iran and the U.S./Europe. IMO it will have a big impact on supply and on the price of oil.
From Investor Village with my takes in blue.
In a nutshell demand in 4th qtr. of 100.2mm bbl. p/d. Supply rose in July to 99.4mm bbl. p/d 1.1mm bbl. p/d above a year ago. < So, where will another 800,000 bbls per day come from? Answer: Inventories.
July was a month of relatively quiet geopolitics. Permian basin shale just reached the take away bottlenecks in July. Demand will grow by 1.5mm bbl. p/d in 2019. As SLB and others have stated there is over 3 yrs. of insufficient CAPEX. There are 15 oil producing countries with declining production. NOC's have had increasing demand on their revenues for their populaces. There is concern that the robust years of intense EOR in the world's legacy fields to keep production flat to up may lead to cliff like declines in some of these.
We will be drawing 800m bbl. p/d in the 4th qtr. from inventories. Demand will grow by 1.5mm bbl. p/d on average in 2019. Insufficient pipeline takeaway in the Permian which has been by far the leader in worldwide production growth will not be alleviated until late 2019. Canadian oil production, the 2nd. largest contributor to worldwide production growth has also been restricted by lack of pipeline capacity. Canadian producers have been relying on rail increases which has been hampered by lack of equipment.
Dependence on OPEC and Russia will increase in 2019. Brazil will add production which will be a help. It will be interesting to see what ROBEC can do or have we seen the GCC capacity during the market share wars? Barring a worldwide recession caused by trade tensions and/or banking issues oil prices will rise in 2019.
Not given much attention in the IEA report is the impact of sanctions and increased tensions between Iran and the U.S./Europe. IMO it will have a big impact on supply and on the price of oil.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group