Thursday, August 11, 2011

Global Oil Supply Increases in July


Global liquid fuel supply increased again in July according to both OPEC (secondary sources) and the IEA.  See the graph above for the history since the beginning of 2008.  We are still not quite back to the level of January, immediately before the Libyan crisis.  In my view, this constriction in energy supply was an important factor in the slowdown in the global economy in the first half of 2008, along with the uptick in inflation.  The uptick in production in the last couple of months, and the fall in prices, will ease that strain (though it's not the only important factor of course).

Here is the longer history from 2002 with monthly WTI spot price on the right hand scale:


And here's the price-vs-production chart:





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4 comments:

  1. Alexander AcAugust 11, 2011 at 7:12 AM

    Now, with the 2nd phase of credit crunch already underway, meaning that oil price will eventually collapse well below 50 dollars, which will mean collapse in oil consumption and consequently on production - and that will erase billions of investments into future production.

    By the time 2nd phase of credit crunch it should be clear to everybody that we are behind peak oil... ok, I am optimistic at this point...

    Alex

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  2. Mike AucottAugust 11, 2011 at 7:20 AM

    Is it clear whether or not the July total includes the 60 million barrels released from the strategic reserves?

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  3. KLRAugust 11, 2011 at 9:48 AM

    The SPR oil is still en route: DOE: 14.19 Million Bbls Of US Oil-Sale Crude Delivered As Of Aug. 10.

    Some 46.3% of the 30.64 million barrels of crude oil sold from the government's emergency stockpile has been delivered as of Wednesday, the Energy Department said Thursday.

    Contracts were awarded July 12; does that equate to 1 mb/d on the US's behalf? But I was under the impression this was 60 mb in one month.

    How far were distillate prices pushed up in Europe? That would be a fruitful avenue to head down; was it much higher than US gasoline prices? End consumers are oblivious to gross production data, after all. And OPEC have made moves of this side in the past, with no correspondence to recessions. But did the lower grade oil place such a strain on European refiners that they were forced to jack prices up through the roof?

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  4. The Rational PessimistAugust 11, 2011 at 11:40 PM

    Stuart.

    Do you think it is still correct to create your charts against WTI and not Brent given the well-documented distribution problems as Cushing?

    And I am just curious as to what percentage of US oil consumption is of WTI priced crude (and what percentage of world oil consumption)?

    Thanks

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