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Article published on: 09/10/18
-Demand for oil continues to grow despite increased focus on controlling emissions due to global warming.
-There are already growing signs that global demand for oil will peak and decline to some degree by the late 2030s

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Equinor's oil platform in Johan Sverdrup oilfield in the North Sea, Norway. Credit Credit Nerijus Adomaitis/Reuters

What is the future of oil?

It's hard if not impossible to say for sure, but there are few more important questions, since the answer will be a key guide to the fate of humanity over the next century.

It's worth speculating about because the climate will depend on it, with the burning of gasoline and diesel key drivers for global warming. The balance of international power is also in play, with the future fortunes of such foes as Russia and Iran tied to the commodity. Huge fortunes could be made or lost from any shifts in the energy economy, which is currently controlled by some of the largest private and state corporations in the world.

Predicting the energy sources of the future has always been a fool's game. In the 1950s, nuclear energy was supposed to promise cheap power for all but is now in eclipse. Biofuels seemed to hold great promise a decade ago, but now are little more than an afterthought. When most experts thought the country's oil reserves were in decline, shale drilling unleashed a boom in natural gas and oil production that now seems to perpetuate the dependence on fossil fuels except coal.

The 2015 Paris climate agreement appeared to be a turning point, when nearly every country committed to slashing its carbon emissions. But there has been some backtracking, especially from the Trump administration, which is withdrawing from the agreement and moving to weaken rules on future auto emissions.

A plan by Norway's $1 trillion sovereign wealth fund to divest of $40 billion in oil stocks is meeting reluctance from within the government.

"The demand for oil continues to grow even as there is an increased focus on controlling emissions and addressing the climate agenda," said Daniel Yergin, the energy historian and author of "The Prize: The Epic Quest for Oil, Money & Power." But he added that he would not discount an eventual change in the direction of energy markets, even while it is "difficult to predict a breakthrough that perhaps is now unimaginable. The big change may be a merger of Silicon Valley and Houston."

Big oil is beginning to hedge its bets on the future, under pressure from activist investors and the public, while also worrying about future regulation. A pivot may be starting, with ExxonMobil and BP engineers working on advanced batteries, Royal Dutch Shell scientists working on hydrogen fuel cells, Saudi Arabia's sovereign wealth fund investing in Tesla, and the oil industry broadly deploying artificial intelligence, robotics and faster data processing throughout their operations.

Many experts remain skeptical that oil companies will be at the forefront of change and undercut their own businesses. Regardless of who leads the change away from oil - if there indeed is a change - there are already growing signs that global demand for oil will peak and decline to some degree by the late 2030s.

That would not be fast enough for the world to achieve the goal of the 2015 Paris climate agreement to limit global warming to 2 degrees Celsius above pre-Industrial Age levels. Still, it would mark one of the most remarkable economic swings of the last century, given that global demand for oil has more than tripled since 1965.

In what may be a sign of things to come, India has announced that by 2030, all new cars sold in the country will be electric.

BP projects in its 2018 Energy Outlook report that demand for liquid fuels, particularly oil, will grow over most of the next two decades, and decline in the late 2030s because of efficiency improvements in passenger and freight transport, and a gradual increase in popularity of electric cars. Renewable energy sources like solar and wind will increase their share of global power generation from 7 percent to roughly 25 percent by 2040.

Norwegian risk-management firm DNV GL raised eyebrows across the oil industry in September by forecasting that demand for crude will crest in the early 2020s.

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A trader works on the floor of the New York Stock Exchange. Predicting the energy forces of the future has always been very difficult. Credit Michael Nagle/Bloomberg, via Getty Images

Most of the major oil companies are counting on petrochemicals and plastics to continue to drive oil profits. They also hope the natural gas they produce and ship will continue to replace coal burning for electricity generation.

Not surprisingly, oil executives typically scoff at the notion of a world without oil.

"The need for hydrocarbons has always been there and will always be there," said David Sealock, chief executive of Petroteq, a Canadian oil company mining oil sands in Utah.

Mr. Sealock and many other oil executives do not deny that climate change is an issue, nor that it is caused by the burning of fossil fuels.

He points to technology as the solution that will allow societies to continue burning them safely, noting efforts by the billionaire investor Bill Gates and others to extract carbon dioxide from the atmosphere through advanced industrial-scale engineering.

Mr. Sealock and a few other oil executives see the possibility that natural gas, which frequently bubbles up with oil from the same wells, could provide the raw material for the production of hydrogen for fuel cells that would limit the exhaust of cars to drops of water.

That may all be wishful thinking on the part of Mr. Sealock, who is managing a company that is attempting to unlock billions of new barrels of oil. If he is right, that could be a convenient solution not only for the climate (unless there are unintended negative consequences to fiddling with the atmosphere as some fear), but also for a slew of countries that rely on oil for their economic well-being across much of Africa and the Middle East, as well as Russia, Mexico and emerging producers like Brazil and Guyana.

But there is another view, decidedly a minority one still, that believes the days of the fossil fuel age are numbered. One such futurist is Dieter Helm, an Oxford University energy economist and author of "Burn Out: The Endgame for Fossil Fuels," published last year, who says he believes that the world is poised for a technological transformation that will produce new sources of power, advanced energy storage and a rise in the efficiency of the economy so less energy is needed.

"We know the supply of solar is infinite," Mr. Helm said. And in the next 20 years, he added, "We'll have factories that run on robots, we'll have 3-D printing, artificial intelligence and so on that will make energy demand remarkably more flexible in factories, offices and houses too."

Such technologies are already taking hold, and in Mr. Helm's view they will speed up as global leaders are forced to manage the impacts of climate change, which appear to be accelerating. It's not going to immediately happen, but he says he believes the big oil companies will eventually go the way of the horse and buggy.

"Why do you think Exxon is better at battery or new storage technology than a start up?" he said. "Just like the Telcos didn't take over the internet world, they will try, they will do a bit, but I think very gradually they will decay."

Some oil company executives say they are accepting the challenge of a lower carbon world, and they are ready to adapt.

One of the leaders is Eldar Saetre, chief executive of the Norwegian oil giant Equinor, whose company is a pioneer in offshore wind power.

While Equinor has acknowledged that it will have to leave some hydrocarbons in the ground, Mr. Saetre said his industry is going to have to adjust faster.

"There are companies that could do more," Mr. Saetre said, choosing his words carefully.

"I see a lot of players with a conscious and aggressive approach, but it's an evolution and there is room for more engagement in our industry."

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What is the future of oil? It's hard if not impossible to say for sure, but there are few more important questions, since the answer will be a key guide to the fate of humanity over the next century.

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Current Output & Global Oil Market Equilibrium

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Current Output & Global Oil Market Equilibrium

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Article published on: 14/9/18
- It was mentioned that current oil outputs should be able to keep the global oil market balanced

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Offshore Technology | Oil and Gas News and Market Analysis

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The president of the Organization of the Petroleum Exporting Countries (OPEC) conference Suhail Mohamed Al-Mazroui announced during the Algeria meeting on Sunday that current oil outputs should be able to keep the global oil market balanced.

Al-Mazroui said during the opening of the OPEC and non-OPEC Joint Ministerial Monitoring Committee (JMCC) in Algiers: "The current oil production capacity is able to ensure and maintain a balanced global oil market."

He added that OPEC can "control and maintain the balance for a long time", and that neither overstocking nor destocking will be required.

Al-Mazroui, who is also the UAE Energy Minister, called for greater dialogue between OPEC members, non-members and consumer nations, saying that he expected OPEC "to attract more oil producer countries to join the agreements and helps safeguard and sustain the global oil market balance."

The JMMC consists of four member states, Algeria, Saudi Arabia, Kuwait and Venezuela, as well as two non-members Russia and Oman.

"The current oil production capacity is able to ensure and maintain a balanced global oil market."

The objective of the JMCC was to ensure the success of the 2016 Declaration of Algiers, which aimed to reduce oil outputs across the board by 1.8 million bpd to adjust production in the range of 32.5 million bpd to 33 million bpd. This was addressed in an effort to combat plunging oil prices.

According to OPEC's World Oil Outlook (WOO) 2018 report, which was launched at the conference, oil is expected to remain the primary fuel source with the largest share in the global energy mix through to 2040. Demand for oil of that period is expected to climb to more than 111.7 million barrels per day.

The demand for natural gas will see the largest demand growth in absolute terms, while the demand for renewables will witness the largest proportional growth.

OPEC secretary general Mohammad Sanusi Barkindo, who unveiled the WOO, said: "The importance of these recent developments, specifically in terms of helping achieve sustainable market stability, is clearly vital across all timeframes."

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Current oil output is enough for global oil market equilibrium, says OPEC

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The president of the Organization of the Petroleum Exporting Countries (OPEC) conference Suhail Mohamed Al-Mazroui announced during the Algeria meeting on Sunday that current oil outputs should be able to keep the global oil market balanced.

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Articles published on: 14/11/18

The crude oil market in United States has shrink over a quarter of its original value.

Recently, the market for crude oil has recently flipped which also means that the market supply exceeds market demand due to a decrease in the consumption by consumers. The article also stated that the drop of oil prices is due to macro funds getting out of the crude trade and rotating into natural gas futures. The demand of natural gas has increased to 60% over the last two months as the colder weather has gone beyond expectations.

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"The worst is over on the crude oil side. In nat gas, it's anyone's guess what could happen," Fisher said in an interview with CNBC's " Squawk Box."

Natural gas has surged nearly 60 percent over the last two months as colder-than-anticipated weather descends on much of the United States. That is fueling demand for heating at a time when the country is entering winter with the lowest levels of natural gas in storage in over a decade.

On Wednesday, natural gas surged to $4.929 per million British thermal unit, its highest level since February 2014. The contract was last trading more than 7 percent higher at $4.395 per mmBtu.

Fisher predicted in the summer of 2017 that investors would see a streak of unseasonably warm winters break in the next year or two, and that natural gas prices would shoot to $4 or $5 per mmBtu.

"I don't know how cold the winter is going to be, but the fear of a cold winter - and the winter hasn't even really start yet - is driving nat gas prices," Fisher said. "Obviously if it was later in the winter, there would be less fear because there would be less of a winter left."

Oil prices were higher Wednesday, recovering from a record 12-day losing streak for U.S. crude and a 7-percent plunge on Tuesday alone. The prospect that OPEC and allied producers will agree to cut output at a meeting next month is pushing oil prices higher.

U.S. West Texas Intermediate (WTI) crude oil futures were up 64 cents, or 1.2 percent, at $56.33 per barrel at 9:40 a.m. ET. International benchmark Brent crude oil futures were up $1.11, or 1.7 percent, at $66.58 per barrel.

Record crude production from the United States and Russia and signals that output from several other nations will grow more quickly than expected in 2019 have pressured oil prices in recent weeks.
- Reuters contributed to this report.

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Renowned energy trader Mark Fisher says the worst is over for oil and it's time to buy

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"The worst is over on the crude oil side. In nat gas, it's anyone's guess what could happen," Fisher said in an interview with CNBC's " Squawk Box." Natural gas has surged nearly 60 percent over the last two months as colder-than-anticipated weather descends on much of the United States.

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Article published on: 11/11/18
-Major oil producers are considering changing of course and the cutting of production of oil.
-Mentioned that the gap between supply and demand of oil could widen next year.
-Oil prices have rose strongly this year due to potential future supply shortages, but slow decrease in price have recently been observed.
- Brent crude, the international benchmark, has fallen almost 20 percent to just over $70 a barrel from about $86 a barrel on Oct. 4.
-Reasons for drop in price includes increase in production of oil
-Saudis suggested to cut production by half a million barrels a day beginning next month

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The Saudi oil minister, Khalid al-Falih, and his Russian counterpart, Alexander Novak, addressing a news conference on Sunday after a meeting of oil officials in Abu Dhabi. Credit Credit Ali Haider/EPA, via Shutterstock

Major oil producers meeting in Abu Dhabi on Sunday signaled that they were considering once again changing course and cutting production.

But the group, which included the Saudi oil minister, Khalid al-Falih, and his Russian counterpart, Alexander Novak, did not make any firm decisions. Those are more likely to come when officials gather in Vienna in the first week of December for a meeting of the Organization of the Petroleum Exporting Countries.

A statement after the meeting on Sunday, however, did warn that the gap between supply and demand could widen next year, which "may require new strategies to balance the market."

The producers at the meeting, from OPEC and non-OPEC nations, are clearly worried about the recent reversal of oil prices. After rising strongly this year on concerns about future supply shortages, oil prices have been sliding of late. Brent crude, the international benchmark, has fallen almost 20 percent to just over $70 a barrel from about $86 a barrel on Oct. 4. "The concerns have diametrically flipped," said Antoine Halff, a founding partner of Kayrros, a market research firm based in Paris.

There are several reasons for the price drop. After restraining output since early 2017, the Saudis and Russians have significantly increased production in recent months, in part a response to pressure from President Trump. At the same time, Iranian output, which was expected to be hit hard by the Trump administration's reimposition of sanctions this year, appears to be holding up better than expected.

The granting of temporary exemptions to several of Tehran's biggest customers, including China, Japan and India, has also caused analysts to question whether their forecasts about Iranian exports were too dire.

In addition, output from shale oil producers in the United States has been growing much faster than analysts previously expected.

The Saudis, the world's largest oil exporters, are determined to try to shape the market to their liking, but doing so in the coming weeks and months may prove difficult, analysts say. For one thing, many uncertainties remain, including the impact of the Iran sanctions, which took effect on Nov. 5.

In addition, the Saudis, who suggested before the meeting that they would cut production by half a million barrels a day beginning next month, may need to take most of the hit themselves.

While Russia has become closely aligned with Saudi Arabia over the last two years, the signals are that Moscow, whose oil companies have invested heavily in increasing their output, will be reluctant to begin reining in production again so soon.

"In the final analysis, the Saudis are still the swing producers in the oil markets, whether they like it or not," said Bhushan Bahree, an OPEC analyst at IHS Markit.

A version of this article appears in print on , on Page B8 of the New York edition with the headline: Oil Producers Weigh Cuts To Counter Slide in Prices. Order Reprints | Today's Paper | Subscribe

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OPEC, Russia Weigh Production Cuts to Prop Up Oil Prices

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Major oil producers meeting in Abu Dhabi on Sunday signaled that they were considering once again changing course and cutting production. But the group, which included the Saudi oil minister, Khalid al-Falih, and his Russian counterpart, Alexander Novak, did not make any firm decisions.

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Article published on: 14/11/18
-The world oil demand has been increasing with some fluctuations from 2014 to 2018
- It has increased from about 94mb/d in 2014 to about 99.84mb/d in 2018
- The world oil supply has been

has also been increasing with some fluctuations from 2014 to 2018
-It has increased from about 95.34mb/d in 2014 to about 100.74mb/d
- The oil supply had increased sharply towards the end of 2016, with gains in the Middle East, Russia and the United States greater than compensating for losses in production in Iran, Venezuela and elsewhere.

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Home " Publications " Oil Market Report " OMR Public

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The Organization of the Petroleum Exporting Countries(OPEC) has announced that the supply of oil have been increasing.
Oil supply is increasing 98.9mb/d
Oil demand: 98.82mb/d
Oil supply is increasing at 2.02mb/d
Oil demand increasing at 1.62mb/d
Since the supply of oil is growing greater than the demand, oil price can expect a drop in the near future.

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BARBARA GINDL | AFP | Getty Images

Despite fears of disruptions to global oil supplies and curbs on production, major oil producing group OPEC sees global oil supplies as fine - it's demand that should be worrying people.

The 15-member OPEC said Wednesday in its latest monthly report that preliminary data suggested that the global oil supply increased 490,000 barrels a day to average 98.9 mb/d in August, compared with the previous month.

In 2018, OPEC believesthe non-OPEC oil supply in 2018 will grow by 2.02 million barrels a day (mb/d) despite making a downward revision of 64,000 b/d from its last report. In 2019, non-OPEC oil supply is expected to grow by 2.15 mb/d, a minor upward revision of 17,000 b/d.

Meanwhile, OPEC's supply is also rising.

According to secondary sources (that is, not the producers themselves) total crude oil production by OPEC members averaged 32.56 mb/d in August, an increase of 278,000 b/d over the previous month.

Crude oil output increased mostly in Libya, Iraq and Nigeria, while production declined in Iran, Venezuela and Algeria.

Iran is due to be hit with sanctions on its oil industry from November onwards while Venezuela is experiencing economic and political upheavals, affecting production.

Oil production by OPEC's defacto leader Saudi Arabia has ticked up since May, when it and Russia signalled that they could increase output to fill any supply shortages due to incoming U.S. sanctions on Iran's oil industry.

The increase comes despite an ongoing deal between OPEC and non-OPEC producers, notably Russia, to curb oil production (and limit it to 32 million barrels a day) in order to support prices. The deal, in place since late 2016, has effectively lifted prices from a slump in 2015 to current levels of around $79 a barrel for Brent crude and $69 for U.S. West Texas Intermediate.

The latest data from OPEC, collected both by direct communication with producers and from secondary sources, shows a contrasting picture of production in Iran as it faces impending oil sector sanctions.

According to secondary sources, Iran's oil supply production fell by 150,000 barrels a day from July to August to around 3.5 mb/d.

But Iran has reported stable and unchanged production figures for the last three months, however, of 3.8 mb/d.

The demand picture

While global oil supplies look relatively robust according to OPEC's latest analysis, the demand picture is one of growth, but dented growth.

OPEC revised its world oil demand growth forecasts lower for both this year and next. In 2018, world oil demand is expected to grow by 1.62 million barrels a day, a minor downward revision from last month's projection.

"World oil demand growth in 2018 was revised downward by around 20,000 b/d, primarily as a result of the slower-than-expected performance by non-OECD Latin America and the Middle East during the second quarter of 2018," OPEC said in its latest report published Wednesday.

"Hence, world oil demand growth is now pegged at 1.62 mb/d for 2018, with total global consumption at 98.82 mb/d," it said.

"In 2019, world oil demand growth was revised slightly lower by 20,000 from the previous month's report, primarily as a result of economic revisions to Latin America and the Middle East," it said.

"World oil demand growth (in 2019) is now anticipated at 1.41 mb/d and total global consumption at around 100.23 mb/d."

The China factor

What has started to trouble oil market watchers relates to the demand picture, with fears that punitive U.S. tariffs on Chinese imports could weaken demand the country's demand for oil.

Looking at the global oil trade, OPEC noted that while China's crude oil imports dropped in July by 70,000 barrels a day from the previous month to average 8.62 mb/d, based on an annual comparison, China's crude imports were still higher by 420,000 b/d in August, or 5 percent higher from a year ago.

Demand for oil from the 15-member producing group OPEC is expected to fall the rest of 2018 and into 2019, OPEC said. In 2018, demand for OPEC crude is expected at 32.9 million barrels a day (mb/d), which is 500,000 barrels a day lower than in the previous year, the organization said.

OPEC forecasts that demand for its crude at 32.1 mb/d in 2019, around 900,000 b/d lower than a year earlier. Yet, total world oil demand in 2019 is now projected to surpass 100 mb/d for the first time and reach 100.23 mb/d.

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OPEC sees global oil supply as robust, demand growth revised a touch lower

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BARBARA GINDL | AFP | Getty Images Despite fears of disruptions to global oil supplies and curbs on production, major oil producing group OPEC sees global oil supplies as fine - it's demand that should be worrying people.

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- The statistic has shown the decrease in demand of oil in Japan
-  There is a decrease in demand of oil from 4.4 million barrels per day in 2013 to 3.7 million barrels per day in 2016
- There is also a projected decrease in demand of oil from 3.7 million barrels per day in 2016 to 2.1 million barrels per day in 2040

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Oil demand in Japan 2013-2040 | Statistic

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This statistic outlines the oil demand in Japan from 2013 to 2016, with projections until 2040. It is projected that the demand for oil in Japan in 2040 will be some 2.1 million barrels per day, a decrease from the demand in 2013 of 4.4 million barrels per day.

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Although Singapore tries to reduce the number of cars that are on road. However, the number of cars are not reducing much.
In this case, citizens of Singapore needs petrol to run their cars. regardless of the price of the petrol price in Singapore, citizens are willing to pay for it. Especially Singapore is a highly developed country where the residents are earning high incomes, petrol prices fluctuation doesn't affect a big part of their life.
Thus, oil price is inelastic to Singapore residents