Wednesday, March 31, 2010

Oil Production Recovery is Coming From Everywhere

I mentioned yesterday that I didn't know where the recovery in global oil production had come from.  Now I do.

To refresh, since the trough in May 2009, global liquid fuel production has increased by just over two million barrels/day (mbd):

and it's now within about 1.5 mbd of retesting the series highs from mid-2008 (the horizontal dotted lines in this next graph):

To assess where this increase came from, this morning I looked just at the IEA Oil Market Report, and compared the May 2009 figures (last reported in the Oil Market Report of August 2009), with the initial figures for February 2010 (as reported in the March 12th 2010 report).  Liquid fuel supply has increased by 2.2mbd in that time, and the breakdown is as follows:

On the left, I show just a broad breakdown into OPEC (blue) and non-OPEC (red) portions of the increase.  On the right, I show a more detailed breakdown of all countries with at least 90kbd of increase in that time period.  As you can see, the increase is pretty broad rather than being anchored in a few countries.  It seems like one should probably think of this as a general systemic response to $70-$80 oil.  In particular, it's notable that the core Middle Eastern OPEC members (Saudi Arabia, Iran, Kuwait, UAE) have not contributed materially to the post-recession production recovery (they are holding back to maintain prices).

Update: In a comment on yesterday's post, dcoyne78 performs a similar exercise, only with EIA data from May-Dec 2009, rather than with IEA data from May '09 - Feb '10.  Allowing for some noise month-to-month, and agency-to-agency, the conclusions seem reasonably consistent.


Mike Aucott said...

I realize you've consistently tracked total liquids production rather than crude oil production, and of course total liquids is an important number. However, isn't there a concern that the total liquids picture could be increasingly clouded by the inclusion within total liquids of "other liquids" which include biodiesel, ethanol, liquids produced from coal and oil shale, etc.?

KLR said...

Not really about issues of EROEI and double counting, but: from Jan 2007 to Dec 2009 EIA "Other Liquids" has increased about 650 kb/d. This isn't C+C/unconventional/NGLs, leaving...what, exactly?

Checking their definitions I get "Total Oil Supply includes the production of crude oil, natural gas plant liquids, and other liquids, and refinery processing gain.," and "The Other Products category includes asphalt, coke, aviation gasoline, lubricants, naphthas, paraffin wax, petrochemical feedstocks, unfinished oils, white spirits, and blending components." Product streams, who cares about that?

Production of "Crude Oil, NGPL, and Other Liquids" for Dec '09 was 83,174.092 kb/d, "Total Oil Supply" was 85,347.475 kb/d. I assume the difference is those biofuels? Rather confusing, the EIA's site is a great resource but it sometimes comes up short here and there.

Mike Aucott said...


There's a difference between what EIA calls "other liquids" and what it calls "other products." "Other liquids" (see
/ipsr/appc.html) includes "biodiesel, ethanol, liquids produced from coal and oil shale, non-oil inputs to methyl tertiary butyl ether (MTBE), Orimulsion, and other hydrocarbons."

KLR said...

But my definitions are what you get when you select "Notes" in the International Energy Statistics; yours are from the IPM. Why do you have to go to another section of the site to obtain this definition? No doubt you're right but like I said they obfuscate this a bit.