Presentation on theme: "The Balancing Act: Perspectives of the Global and Domestic Oil Markets Frederick J. Lawrence Vice President - Economics and International Affairs."— Presentation transcript:
The Balancing Act: Perspectives of the Global and Domestic Oil Markets Frederick J. Lawrence Vice President - Economics and International Affairs
Alien Vs. Predator Demand appears to be driving Fundamentals in a Tight Market – is it Sustainable? Global Economy, Asia Growth Components & More? World demand up an estimated 2.7 Mmb/d (3.4%) US demand up 460,000 b/d (2.4%) & China demand up an estimated 860,000 b/d (16.5%) in Supply Reacts to Demand and Price but hitting Capacity limitations OPEC & Non-OPEC Potential – Market Share vs. Reserves Spare Capacity & Just in Time Behavior – narrow the gap Energy Security, Interdependence & Diversification – growing connectivity between foreign and domestic policy = INCREASED VOLATILITY & FEAR FACTOR
Where is the incremental demand coming from by region?
Demand is breaking out and were en route to 90 Mmb/d QUARTERLY AVERAGEYEARLY AVERAGE
China – Growth Spurt
China will continue to be a big part of the demand story.
Dont discount growth in the rest of Asia – especially India
UN Perspectives on Sustainability
Global Population Surge
Projected Global Petroleum Demand
Proved Oil Reserves – Not Created Equal
Supply is also adapting to a new threshold but can it be maintained?
Comparative Oil Production
OPEC is building capacity and trying to manage production based on demand.
Non-OPEC has captured market share but sustainability in question.
Former Soviet Union Dominates Non-OPEC Supply Gain
Pragmatic Oil Diplomacy
Projected Source of Global Conventional Oil Supply
The Wrong Cow is Getting Fat
U.S. Energy Shares (2003)
U.S. Petroleum Balance
U.S. Petroleum Consumption
U.S. Import Sensitivity by Region (2003)
Domestic Crude Production
Where Does Our Energy Come From? 2003 Wells Drilled = Gas = CBM = Horizontal = Oil = Dry
Where is Our Energy Used?
Vermont Energy – where a woodchuck could chop wood
Producing 18 Quads of Energy Per Year Biomass
Percentage of US Congressmen from Selected States Voting for Energy Issues
Volatility at Work ( )
U.S. Oil Deficit
Demand calls shots until proven differently Market volatility looks sustainable Integrative solutions needed There will be a sequel Demand calls shots until proven differently Market volatility looks sustainable Integrative solutions needed There will be a sequel Conclusion