Wednesday, January 30, 2013
We now have December data for global liquid fuel production, which allows us to see the whole year. What has been striking about 2012 is that oil production has been remarkably flat, with no significant rise across the year (there was a small 0.25mbd/yr trend overall, but that was not statistically significant).
This is in contrast to 2009-2012 when production has generally increased, except for the interruption of the Arab Spring, particularly the loss of Libyan production in early 2011. Instead, 2012 looks more like 2005-2007 when production was pretty much flat, occasioning a huge spike in global oil prices.
If this new 2012 production plateau continues, I would expect prices to rise again. They have otherwise been on a gentle slide since the situation in Libya stabilized in mid 2011: