Russian oil smashed through the $60/b G7 price cap as crude exports in July hit the highest level of 2023.Īccording to the IEA, Russia’s oil exports averaged about 7.3 mln bpd in July. The steep drop in output from US shale wells is turning out to be worse than expected, forcing oil drillers to work even harder to keep production from slipping, research firm Enverus said.īut the US oil industry has constantly proven its resilience, and while growth may slow, there is no reason to believe the end is in sight just yet. Some analysts claim US oil production is nearing its peak as price volatility leads inevitably to less drilling and possibly, later, to a production decline. US oil production is expected to hit a record high this year, but there is uncertainty as to whether the current growth can continue. Wood Mackenzie expects exploration spending to recover from “historic lows” over the next few years. Oil and gas will continue to drive the global economy and define energy security for many years. The roll-out of a low-carbon energy system is going to take time. The International Energy Forum (IEF) and S&P Global Commodity Insights estimate that a cumulative $4.9 trln of investments in global upstream oil and gas are needed by 2030 to meet market needs and prevent a supply shortfall. “We need to invest in today’s energy system responsibly and, at the same time, we must invest in accelerating energy transition”, which the company said must be orderly. The industry is being pressed to come to the summit with a “clear road map” in sync with the Paris Agreement goals.īP urges more oil and gas investment while speeding energy transition. OPEC chairman Haitham Al Ghais said that according to their projection, oil demand in barrels will be higher in 2045 than today – up to 110 mln barrels – and that a “healthy degree of pragmatism” is needed to meet energy needs while curbing emissions.īut already positioning and expectation-setting over the role of oil producers and companies at COP28 is heating up. It has been growing by 1.4%/year on average during the past ten years, with forecasts expecting it to grow by 1.3% in 2023. In the June edition of its ‘Oil Market Report,’ the International Energy Agency (IEA) expects global oil demand to reach a record high of 102.1 mln b/d in 2023, about 2 mln b/d more than in 2019.Įvidently, reports that oil demand has peaked were premature. Worldwide, oil demand is back in growth mode. The EU’s dependence on Russian imports of oil fell to 2.3% in two years and natural gas to 12.9%, according to Eurostat. Iranian oil production is up to about 3.1 million barrels per day. Should Saudi Arabia become an official BRICS member, this stance would significantly undercut the efficacy of Western sanctions. The Saudi energy minister said the “kingdom will not sell oil to any country that imposes a price cap.” This threatens to reignite inflation concerns as much of the world is already grappling with higher energy costs. The oil price has hit the highest level since November 2022 and up 25% since June, as supply cuts by OPEC+ tighten the market. Oil prices surged to over $90 a barrel this week as Saudi Arabia and Russia extended their 1.3 million barrel per day oil cut through to December.
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