Wednesday, March 31, 2010
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.