Energy Market Roundtable
https://www.youtube.com/watch?v=nDYtMvf0aKI&t=10s
The Roundtable Insight - Doomberg, Anas Alhajji, Adam Rozencwajg, Yra Harris on the Energy Markets
You all need to watch this - July 14
You all need to watch this - July 14
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: You all need to watch this - July 14
Thanks for sharing, Dan. Big follower of Doomberg. He is the "Jim Grant " of all things energy.
Re: You all need to watch this - July 14
OPEC sees 2.2% oil demand growth in 2024 despite headwinds
By Alex Lawler
July 13, 2023
REUTERS
Summary
OPEC sees 2024 demand growth of 2.25 million bpd, double IEA's estimate
Raises 2023 demand growth forecast by 90,000 bpd
U.S. shale output growth to slow to 500,000 bpd in 2024 < This won't happen at the current active drilling rig count.
LONDON, July 13 (Reuters) - OPEC on Thursday raised its forecast for oil demand growth for 2023 and predicted only a slight slowdown (not a decline) in 2024 despite economic headwinds as China and India continue to drive the expansion in fuel use.
In a monthly report, the Organization of the Petroleum Exporting Countries (OPEC) said it expects world oil demand to rise by 2.25 million barrels per day (bpd) in 2024, a rise of 2.2%, compared with growth of 2.44 million bpd in 2023.
OPEC's demand growth forecast for 2024 is double that of the International Energy Agency, another closely watched forecaster which updated its outlook earlier on Thursday. Oil added to an earlier gain after OPEC's report was published.
Oil demand growth is an indication of likely oil market strength and forms part of the backdrop for policy decisions by OPEC and its allies, known as OPEC+. The group in June extended supply curbs into 2024 to support the market. OPEC said in the report OPEC+'s pre-emptive approach and cuts had added stability to the market, "based on which the solid oil market fundamentals seen this year are expected to extend into 2024".
"In 2024, solid global economic growth amid continued improvements in China is expected to boost consumption of oil," OPEC said.
Also, in the report OPEC raised its 2023 demand growth forecast by 90,000 bpd from last month. OPEC sources last week said OPEC would stick to an upbeat demand view for 2024 and see higher growth than the IEA. OPEC forecast world economic growth of 2.5% next year compared with 2.6% in 2023, assuming "general inflation" eases in the second half and in 2024. It also assumes key interest rates will peak by the end of 2023.
MORE OPEC OIL NEEDED
The outlook for 2024 suggests oil demand will rise more rapidly than supply from producers outside OPEC. OPEC expects non-OPEC supply to rise by 1.4 million bpd, lagging demand growth and the same rate as 2023.
As a result, OPEC forecast the world will need 30.2 million bpd in 2024 from its members to balance the market, up 800,000 bpd from 2023. For now, OPEC is pumping far less.
The report showed OPEC production rose by 91,000 bpd to 28.19 million bpd in June, led by Iran and Iraq. Iran is one of the OPEC members exempt from cutting output.
The United States is expected to make the biggest contribution to non-OPEC supply expansion next year although OPEC sees growth in U.S. tight oil, another term for shale, slowing to 500,000 bpd in 2024 from 730,000 bpd in 2023.
By Alex Lawler
July 13, 2023
REUTERS
Summary
OPEC sees 2024 demand growth of 2.25 million bpd, double IEA's estimate
Raises 2023 demand growth forecast by 90,000 bpd
U.S. shale output growth to slow to 500,000 bpd in 2024 < This won't happen at the current active drilling rig count.
LONDON, July 13 (Reuters) - OPEC on Thursday raised its forecast for oil demand growth for 2023 and predicted only a slight slowdown (not a decline) in 2024 despite economic headwinds as China and India continue to drive the expansion in fuel use.
In a monthly report, the Organization of the Petroleum Exporting Countries (OPEC) said it expects world oil demand to rise by 2.25 million barrels per day (bpd) in 2024, a rise of 2.2%, compared with growth of 2.44 million bpd in 2023.
OPEC's demand growth forecast for 2024 is double that of the International Energy Agency, another closely watched forecaster which updated its outlook earlier on Thursday. Oil added to an earlier gain after OPEC's report was published.
Oil demand growth is an indication of likely oil market strength and forms part of the backdrop for policy decisions by OPEC and its allies, known as OPEC+. The group in June extended supply curbs into 2024 to support the market. OPEC said in the report OPEC+'s pre-emptive approach and cuts had added stability to the market, "based on which the solid oil market fundamentals seen this year are expected to extend into 2024".
"In 2024, solid global economic growth amid continued improvements in China is expected to boost consumption of oil," OPEC said.
Also, in the report OPEC raised its 2023 demand growth forecast by 90,000 bpd from last month. OPEC sources last week said OPEC would stick to an upbeat demand view for 2024 and see higher growth than the IEA. OPEC forecast world economic growth of 2.5% next year compared with 2.6% in 2023, assuming "general inflation" eases in the second half and in 2024. It also assumes key interest rates will peak by the end of 2023.
MORE OPEC OIL NEEDED
The outlook for 2024 suggests oil demand will rise more rapidly than supply from producers outside OPEC. OPEC expects non-OPEC supply to rise by 1.4 million bpd, lagging demand growth and the same rate as 2023.
As a result, OPEC forecast the world will need 30.2 million bpd in 2024 from its members to balance the market, up 800,000 bpd from 2023. For now, OPEC is pumping far less.
The report showed OPEC production rose by 91,000 bpd to 28.19 million bpd in June, led by Iran and Iraq. Iran is one of the OPEC members exempt from cutting output.
The United States is expected to make the biggest contribution to non-OPEC supply expansion next year although OPEC sees growth in U.S. tight oil, another term for shale, slowing to 500,000 bpd in 2024 from 730,000 bpd in 2023.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: You all need to watch this - July 14
Dan, thanks for the posting this video! Doomberg is very bright and enjoyed his commentary once I got past his Green Chicken and Yellow beak 
All panelist were on point and I learned much. I was not familiar with the acronym EROI and had to look it up. The definitions used are for Energy Return on invested, fundamentally; Output in Energy/Input Investment. Nuclear is by far the best situation. One panelist put Nuclear EROI at 100+. Note solar panels at 2 and Windmills at 4. We are blowing a lot of money on low returns. As the panelists noted, "Basic physics is the barrier to use of these technologies." I subscribed to Adam Rozencwajg website: https://www.gorozen.com/ the others are by subscription. Adam is wide open and smart!
Energy Sources and their EROI’s
Here are the top energy sources and their respective energy return on investment score:
1. Nuclear Energy = 75
2. Hydro = 35
3. Coal = 30
4. Closed-Cycle Gas Turbine = 28
5. Solar Thermal = 9
6. Wind Turbine = 4
7. Biomass = 4
8. Photovoltaic = 2
Calculations and Use of EROI:
Energy Inputs and Outputs
The EROI function measures relative inputs and outputs used to produce energy. Described below are the inputs and outputs that are gathered to calculate EROI.
• On-site Energy Consumption (Input) – On-site inputs that consume energy include labor energy costs, health and safety energy costs, and transportation.
• Energy Embedded in Materials Used (Input) – It includes the materials consumed at the construction, decommissioning, and operational stages.
• Energy used in Labor (Input) – Transportation and energy used for a laborer’s full workday are included in the input calculation.
• Heat, Motion, and Electricity (Output) – The desired outcome of any energy production is either heat, motion, or electricity.
• Environmental Factors (Output) – Energy producing plants and/or technologies can be directly affected by the environment. For example, an earthquake can dislodge a wind turbine or destroy a power plant.
Source:
Energy Return on Investment (EROI) - Overview, Formula, Applications (corporatefinanceinstitute.com)
All panelist were on point and I learned much. I was not familiar with the acronym EROI and had to look it up. The definitions used are for Energy Return on invested, fundamentally; Output in Energy/Input Investment. Nuclear is by far the best situation. One panelist put Nuclear EROI at 100+. Note solar panels at 2 and Windmills at 4. We are blowing a lot of money on low returns. As the panelists noted, "Basic physics is the barrier to use of these technologies." I subscribed to Adam Rozencwajg website: https://www.gorozen.com/ the others are by subscription. Adam is wide open and smart! Energy Sources and their EROI’s
Here are the top energy sources and their respective energy return on investment score:
1. Nuclear Energy = 75
2. Hydro = 35
3. Coal = 30
4. Closed-Cycle Gas Turbine = 28
5. Solar Thermal = 9
6. Wind Turbine = 4
7. Biomass = 4
8. Photovoltaic = 2
Calculations and Use of EROI:
Energy Inputs and Outputs
The EROI function measures relative inputs and outputs used to produce energy. Described below are the inputs and outputs that are gathered to calculate EROI.
• On-site Energy Consumption (Input) – On-site inputs that consume energy include labor energy costs, health and safety energy costs, and transportation.
• Energy Embedded in Materials Used (Input) – It includes the materials consumed at the construction, decommissioning, and operational stages.
• Energy used in Labor (Input) – Transportation and energy used for a laborer’s full workday are included in the input calculation.
• Heat, Motion, and Electricity (Output) – The desired outcome of any energy production is either heat, motion, or electricity.
• Environmental Factors (Output) – Energy producing plants and/or technologies can be directly affected by the environment. For example, an earthquake can dislodge a wind turbine or destroy a power plant.
Source:
Energy Return on Investment (EROI) - Overview, Formula, Applications (corporatefinanceinstitute.com)
Re: You all need to watch this - July 14
My take after watching the podcast is that all four of the very smart people included in the discussion understand that (a) this world runs and will continue to run on oil, (b) the idiots we have elected to run this country have the energy intelligence of children and (c) we are at the beginning of a very big increase in oil prices and all forms of energy.
High energy costs will cause a big increase in inflation. The only way for investors to beat the coming inflation is to invest in real assets and oil will be at the top of the list.
The OECD countries need common sense energy policy and they need it very soon or this will cause an economic "train wreck" in 2024.
PS: Oil supplies cannot keep up with demand for oil-based products. The U.S. has been blessed with massive natural gas reserves. Natural gas can save our standard of living, but we need to move quickly.
PPS: We must quit pissing away money on wind & solar.
High energy costs will cause a big increase in inflation. The only way for investors to beat the coming inflation is to invest in real assets and oil will be at the top of the list.
The OECD countries need common sense energy policy and they need it very soon or this will cause an economic "train wreck" in 2024.
PS: Oil supplies cannot keep up with demand for oil-based products. The U.S. has been blessed with massive natural gas reserves. Natural gas can save our standard of living, but we need to move quickly.
PPS: We must quit pissing away money on wind & solar.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: You all need to watch this - July 14
Do you know of any data analysis that estimates the storage reserves in both quantity and days of usage of China? I realize that China is one of the least transparent major economy in the world.
Re: You all need to watch this - July 14
I don't have a way to verify China's current oil inventory level. Raymond James probably has a good guess since slide 14 of their June slide deck is total global oil inventories.
My Take is that China will draw oil from their SPR to keep China's fuel prices lower for longer. It probably won't have much impact on U.S. oil prices.
My Take is that China will draw oil from their SPR to keep China's fuel prices lower for longer. It probably won't have much impact on U.S. oil prices.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group