Royal Dutch Shell Plc  .com Rotating Header Image

EIA reduces forecast for non-Opec oil production

Times Online
The Times
June 26, 2008

EIA reduces forecast for non-Opec oil production

The world outside Opec is struggling to produce more oil, according to America’s Energy Information Administration, which yesterday reduced its forecast for non-Opec supplies of oil and at the same time trimmed its forecast of global demand for crude.

The sombre long-term outlook by the US government forecasters, who predict a 50 per cent increase in energy consumption by 2030, came as the organisation signalled a short-term rise in US crude oil stocks.

The surge in the EIA’s weekly crude oil inventory data triggered a dip in the oil price. In New York, the Light Sweet crude contract fell by $5 per barrel to $132 as the EIA signalled an 800,000 barrel rise in US crude stocks to 301.8 million barrels.

Evidence of falling petrol consumption in America is mounting as hard-pressed US households cancel journeys and change their behaviour to cope with the cost of expensive fuel.

The emerging markets will account for the bulk of the 50 per cent surge in energy demand in the quarter century to 2030, said the EIA in its International Energy Outlook 2008, published yesterday. While demand from states which are not members of the Organisation for Economic Co-operation and Development (OECD) is expected to rise by 85 per cent, the richer countries of the OECD will use just 19 per cent more energy.

The surge in prices is blamed on Far Eastern and Middle Eastern demand for crude, rising costs and lack of growth in Opec output. The forecasts include a reference case that sees prices easing in the medium term as unconventional oil supplies, such as Canadian tar sands, as well as new conventional oil supplies from Brazil and Central Asia reach the marketplace. In its reference case the oil price dips to $70 per barrel by 2015 and then rises with inflation to $113 by 2030.

However, the EIA admits that the current market conditions suggest a path that more closely resembles its high-price scenario in which the oil price reaches $186 in 2030.

In its reference case, world oil demand reaches 112 million bpd in 2030, but higher oil prices would trim demand by some 13 million barrels.

Guy Caruso, administrator of the EIA, said: “We do think that over the next five to ten years the high prices will bring on new supplies that will put downward pressure on price. But we are not going back to the historic price we saw in the 1980s and 1990s.” Between 1980 and 2000, the crude oil price averaged about $25 per barrel.

royaldutchshellplc.com and its also non-profit sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “EIA reduces forecast for non-Opec oil production”

Leave a Comment

%d bloggers like this: