Global Fossil Fuel Production And Consumption -- 2022 Statistical Report

Locator: 45452OIL.

Updates

August 23, 2023: global oil consumption nears all-time highs. Robert Rapier over at oilprice.

Original Post

Is anyone doing the math? This has been going on for quite some time. Link here.

• global oil production (liquids to include lease condensate and NGLs)
• 2022: 93.8 billion bpd (just sort of the 2019 record)
• 2021: 90 million bopd
• 2019: 94.8 million bod (all-time high)

• global oil consumption:
• 2022: 97.3 million bpd
• 2021: 94.2 million bpd
• 2019: ~ 99.8 million bpd (all-time high)

• Global producers:
• oil production: US took the lead in 2014 and has led every year since then but one
• 2022: US oil production just 3.5% short of all-time record set in 2019; 
• on pace to set new production record this year [despite E&Ps cutting back on CAPEX and drilling]
• the US enjoys a lead over both Saudi Arabia and Russia but not be much, only a million bpd
• but when you include NGLs, then the spread is amazing
• 2022:
• US: 17.8 million bpd
• Saudi Arabia: 12.2 million bpd
• Russia: 11.2 million bpd

• Global top ten consumers:
• Germany dropped out of the top-10 list
• Mexico joined the list at #10
  

Global Oil: Production And Demand -- July 13, 2023

Locator: 45124OIL

Production. Link here. 80 million bopd.

Demand. Link here. 100 million bopd.

The Oil 2023 medium-term market report forecasts that based on current government policies and market trends, global oil demand will rise by 6% between 2022 and 2028 to reach 105.7 million barrels per day (mb/d) – supported by robust demand from the petrochemical and aviation sectors.

Despite this cumulative increase, annual demand growth is expected to shrivel from 2.4 mb/d this year to just 0.4 mb/d in 2028, putting a peak in demand in sight.

In particular, the use of oil for transport fuels is set to go into decline after 2026 as the expansion of electric vehicles, the growth of biofuels and improving fuel economy reduce consumption.

Global Oil Supplies Down To 58 Days, Four Hours, And Forty-Eight Minutes -- IEA -- June 14, 2018

If folks are confused by all the statements coming out of Saudi Arabia, this may be the reason.  

Reuters wonders if OPEC is moving the goalpost for its oil market scoreline.

I have never really believed whatever OPEC says but lately the flip-flops have seemed even more outrageous. First, there's too much oil; then, there's not enough oil; then, there's enough oil now but there won't be enough oil next year; and now, not only is there not enough oil now, there won't be enough oil next year, and US shale oil won't be able to make up the difference.

Four months ago, there was this article from Reuters: surge in global oil supply may overtake demand in 2018 (IEA).

Today, crude oil demand in 2019 will grow another 1.4 million bopd after growing a similar 1.4 million bopd this year (2018).

So, we go back to the data.

First, it's nearly impossible to find OECD crude oil inventories. I think it's around 2 billion bbls. This was from oilprice.com, March, 2018:

At 2.865 billion barrels, OECD stocks were 206 million barrels lower than in January 2017, but 50 million barrels above the latest five-year average, OPEC said. 

But ycharts says the number is 4.4 billion bbls. Whatever.

Regardless, what it is, no one knows how much is really needed.

In the US, we have better data, but folks interpret it differently. At 435 million bbls in reserves, analysts suggest that's below the average median/mean/average for the past five years. And yet, it certainly appears that historically, the US has done just fine with 350 million bbls in reserves. [My benchmark remains: 350 million bbls in reserves.]

So, let's look at what I think is the best metric: the number of days of crude oil supply.

For the US, my benchmark is 21 days. Anything more than 21 days is a "glut." We haven't seen 21 days or less since 2014.

Recent data, from the EIA, US days of supply of crude oil excluding the SPR:

Now, OECD (global) data. From a Financial Times article:

The level of oil stocks in countries within the Organisation for Economic Co-operation and Development has been used as the benchmark of energy market tightness for years.

With an inventory level – measured as the number of days that stocks are able to meet demand – at about 55 days, the market has been seen as roughly balanced.

Anything below has indicated a tight market; anything above, a loose one. The International Energy Agency estimates OECD oil inventories at the end of January to be about 58.2 days of forward demand, suggesting that the oil market is comfortably well supplied. Prices, the theory goes, should be moving lower.

Then this:

But the measure is faulty on two fronts.

Firstly, OECD oil inventories were relevant when rich countries were at the centre of oil consumption by a big margin. But they no longer have such status.

According to the US Department of Energy, the OECD last year accounted for just 53 per cent of global demand, down almost 10 percentage points from 62 per cent a decade ago. Moreover, oil consumption from outside the OECD will surpass oil demand from within it by about 2019. [We've been talking about this for the past several days.]

And this incredibly unenlightened statement:

When Chinese inventories are added to those of the OECD, the measure of coverage of demand drops by a hefty four days, from 58.2 days to about 54 days, suggesting a tight market.

First of all, let's get rid of the "point two" tacked unto the 58 days of supply. Give me a break. Some analyst is able to tell us that OECD (global) oil supplies work out to 58 days and 4.8 hours or 58 days, four hours, and 48 minutes? LOL. 

But seriously, we have no idea how much oil is really sloshing around in tankers or in pipelines -- if it's difficult to come up with numbers for the US (the API and EIA weekly numbers are often quite different), think how incredibly inaccurate global data is.

Then this: look at the days of supply again, from the article --

... when Chinese inventories are added to those of the OECD, the measure of coverage of demand drops by a hefty four days, from 58.2 days to about 54 days, suggesting a tight market.

Remember, a "tight number" was defined as 55 days or below. So 56 days, the Financial Times would have called it a "loose market," but at 54 days, it's a "tight market."

Tell me, truthfully, do you see any difference between 58 days and 54 days of supply for the entire OECD plus China?

The last time I looked at this was February 19, 2018.

ycharts has data as recent as February, 2018: OECD Petroleum Stocks is at a current level of 4.407B, down from 4.429B last month and down from 4.656B one year ago. This is a change of -0.51% from last month and -5.36% from one year ago.

The EIA site might be the best site for such data. Take a look at the EIA graph going back to January, 2013. It certainly appears that the range has been very, very narrow, from 55 days at the very low to 65 days at the very high. Right now, we are pretty much near the lower end but projections for mid-2019 puts us smack-dab in the middle of the range, at about 60 days.

Bottom line: none of us -- analysts or arm-chair nattering nabobs of negativity -- have a clue.

Exxon's Global Energy Demand Forecast Through 2040 -- For The Archives -- June 28, 2016

For the archives: global energy demand forecast.

This graphic is in line with about almost everything else I see.

Observations:

• energy: all the above -- everything is represented here
• the graph goes out to 2040
• this is global energy demand
• coal: the amount actually increased significantly from 2000 to 2015, and really doesn't decrease all that much (if it does, its almost imperceptible)
• natural gas: the huge winner -- compare 2040 with 2015 (or 2000, for that matter)
• oil: even oil shows a huge increase
• nuclear: increases some (China? India? where?)
• other renewables (wind/solar): although there's a relative increase, it looks like about 25 quadrillion BTUs/700 quadrillion BTUs = 3.57%. I.N.C.O.N.S.E.Q.U.E.N.T.I.A.L. A rounding error at best.

By the way:

• 2015: 575 quadrillion BTUs
• 2040: 700 quadrillion BTUs
• (700 - 575) / 575 =  22% increase in global energy demand over the next 25 years.

Note: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on what you read here. But this seems to be an open-book test when it comes to looking where to invest for the long term. 

There is no question that solar has some niches (wind has none, absolutely zero) but as a real global player, unreliable, expensive, non-dispatchable energy is irrelevant.

Light Ends / Light Ends Space-- A New Term (At Least For Me) -- June 5, 2016

Updates

June 12, 2016: this is pretty cool. As noted below, when I googled this term just a few days ago there were five hits. Today, googling "light-ends oil" there were 131,000 hits. Of the 131,000 hits, my post was #14, near the top of the second page. Whoopee. 

 

Original Post

 

There is an incredible amount of information in this paper. I've read the introduction and the conclusion; scanned the information in between. The information "in between" will remain a great reference. 

This link takes you to a "working paper" out of Rice University's Baker Institute for Public Policy, titled "Childhood's End: Developing Asian Giants and the Future of Global Oil Demand." It is dated 2016. A quick look at the paper suggests that Prince Salman is thinking along the same lines.

However, there is a new term -- that's probably been around for decades -- but I just stumbled across it and will come back to it later.

The term is "light ends" or "light ends space." A google search "'light ends space' oil 'natural gas'" led to only five hits, and one of them was a "linked in" hit.

By the way, this subject ("light ends space") and the "working paper" linked above seem, at first glance, to dovetail well with the very astute observation made by Don regarding "gasoline production" numbers, which is noted at length in the "update" at this post. 

Wow, if I miss one day of blogging, I fall behind.

**************************************

A New Term

The link above takes you to a linked "working document" authored by Al Troner. His thesis/article is featured in this month's issue of the Oil & Gas Journal, which requires a subscription. [Update: it looks like one can get to the entire article by googling "'light ends' oil". Here's the link: http://www.ogj.com/articles/print/volume-114/issue-6/general-interest/surge-in-ngl-and-tight-oil-supplies-creates-worldwide-light-ends-space.html.]

Putting "2" and "2" together, it appears that Al Troner, Asia Pacific Energy Consulting, Houston, has not necessarily coined a new term but will do much to put it the term in the everyday lexicon of those of us who follow the oil and gas industry.

I'm pretty jazzed, to say the least, to have come across this. It will be interesting to see where this leads.

The article begins:

While many analysts agree that oversupply, rather than weak demand, led to the current slump in the price of crude oil, few have looked closely at the nature of that supply overhang.

In a new study, Asia Pacific Energy Consulting (APEC) has examined in depth the role of NGLs, in particular condensate, in creating the current surplus, as well as the impact of tight oil and its light derivatives. The condensate, other NGLS (LPG and ethane), light products, and tight oil yeilding much of the new light-product supply all occupy the same light segment of the hydrocarbon spectrum.

The shale revolution has spurred a ballooning of NGL output, paralleled by dizzying growth in tight oil production. Almost all of this incremental liquids production has been light and sweet. The growing volume of this material, with incremental supply in the millions of barrels per day, has begun to shift pricing, trade, marketing, and supply-demand balances for crude -- light-heavy vs sweet-sour --- and in our products, with notable supply gains in LPG, gasoline, and naphtha in contrast to middle-barrel and heavy products.

A "light-ends space" is emerging, not only in the US and the Atlantic Bais but also globally, as markets attempt to adjust to this surge in light, low-sulfur hydrocarbon supply.

**************************************

A New Term: Light-Ends Space

NGLs: Definition

The article focused on the role of condensate as the spearhead creating the light-ends space.

Why? Because condensate is the only NGL that does not need specialized containment and that, when refined, yields a full range of products, from LPG to residual.

Where? Bakken, Eagle Ford, and the Permian.

Facts about condensate:

• once condensate becomes a liquid, it remains a liquid
• in a refinery or condensate splitter, it acts much like crude in the slate
• often confused with light, sweet crude oil but it has distinctive characteristics
• unlike crude oil, condensate always originates with gas, whether nonassociated or associated
• whole condensate almost always yields more than 50% naphtha; and is almost always quite clean, low not only in sulfur but also in metals and acid
• condensates are exceptionally clear, most containing 0.3% sulfur or less

More facts about condensate:

• most observers try to define condensate by setting an arbitrary API gravity breakpoint
• in the US commonly 45 degrees API
• international trade, usually 50 degrees API

But rules are made to be broken

• there are some crude condensates well above 50 degrees API; e.g., Saudi Arabia's Super Light and Australia's Laminaria
• there are some crude condensates below 50 degrees API; e.g., Kazakhstan's Karachaganak and Nigerian Oso
• in definition, what constitutes condensate, API gravity is only a general indicator, not an exact test of what is condensate and what is crude

Bottom line: what makes a condensate a condensate

• always originates in gas
• almost always yields 50%+ naphtha
• is exceptionally sweet
• contains little if any metals
• produces little residual oil
• a crude and condensate can have exactly the same API gravity but the condensate will always yield far more naphtha and far less fuel oil

The US and condensates?

• the US has emerged as a major NGL power due to the shale revolution
• despite recent events (2016), overall NGL output will continue to rise despite declining condensate volumes produced with tight oil (EIA)

Why?

• NGLs are caught in a twilight zone: NGLs come from both the crude and gas sides of total production
• while condensate has been the most prominent NGL derived from gas produced in association with tight oil, plays such as the Eagle Ford shale; Permian basins also have produced sizable volumes of LPG and even commercial volumes of ethane
• yet NGLs also come from primarily non-associated gas production as well, such as the Marcellus and Utica shales

*****************************

Notes From a Working Paper

Six chapters:

• Chapter 1: Introduction
• Chapter 2: Asia Pacific Demand Growth: Demand Growth by Sector
• Chapter 3: Recent Developments in Middle-Distillate Retail Price Subsidies
• Chapter 4: Asia Pacific: Comparing Light-Ends and Middle Distillate Growth
• Chapter 5: Product Quality Premiums
• Chapter 6: Conclusion

Chapter 1, Thesis: 

• Asia Pacific will remain the engine of world oil demand growth
• but future growth will be at a lower rate of expansion
• in addition, future demand will shift away from mid-barrel to light-ends products, such as LPG, gasoline, and naphtha
• bad news: US oil exporters will not get the growth they saw 1990 - 2000, or even 2000 - 2010
• Asia has begun to exhibit characteristics of more mature economies
• good news: Asia Pacific will likely continue to lead world oil demand growth for the remainder of this decade and the next (through 2030)
• the growth will be greatest in the light end of the barrel
• the working paper focuses on China, India, and Indonesia

Chapter 1.  Introduction

Sections A - H: 

• historical review

Section I: US exports -- a natural fit. 

• the growing Asian demand for light ends has coincided with the shale revolution in the UNITED States and a massive influx of sweet, light crude and NGLs onto the US market. With a crude export ban n place, the US had to focus on exporting light refined products and NGLs. 
• But, since late December 2015, the paradigm has shifted.
• Asia Pacific wants to end dependence on Mideast; long term trend: North America will compete with Mideast for demand growth in Asia Pacific
• US West Coast geographically closer to Asia Pacific
• but US Gulf Coast has a substantial edge in almost every other export factor: 
• relatively easy permitting process for building infrastructure; 
• a greater number of sophisticated refineries with more capacity
• proximity to two of the three largest tight oil basins: Eagle Ford and the Permian
• the Panama Canal serves as an enabler -- it puts the USGC close enough to compete with Mideast sales on the basis of different price formulae
• the author talks about the Panama Canal, saying the same thing RBN Energy has already talked about: the revamped canal will allow transit of all LNG tankers, except the two largest, the Q-Max and the Q-Flex; in other words, the Panama Canal can handle 90% of the world's LNG fleet
• the canal's expansion will be finished in 2017; already talking about further expansion

Section J: Export Opportunities  

• lower growth
• light-ends focus
• Panama Canal changes everything
• powered by the shale revolution -- and an easing of export regulations -- NGL producers responded quickly to marketing in Asia

Section K: Linked Lines of Query

• overall demand growth; changes in sector use
• deregulation and retain subsidies; impact of mid-distillate demand growth
• for Asia Pacific, it's all about naphtha; Asia is structurally depended on naphtha imports
• price deregulation has accelerated the use of light product over middle distillates; most fully achieved in Indonesia; to a lesser extent in Thailand, Malaysia, and Vietnam; we will know more about India by the end of the year; Asia Pacific is switching from diesel to gasoline; naphtha will dominate the petrochemical feedstock supply but naphtha is also required as the basestock for gasoline manufacturing
• future comparative growth rates
• impact of product quality in maturing Asian economies

Chapter 2. Asia Pacific Demand Gowth: Demand Growth by Sector

A. Asia Pacific

1. Basic Parameters of Demand 

2. Demand Trends by Product & Sector: this is a very, very interesting section; the author talks about a breakout point, "when expanding middle class incomes all for the possibility of acquiring private transport." This has recently been discussed on the blog. A reader personally noted this in India. 

B. Developing Asia

1. China: section on gasoline demand is very, very interesting

2. India: 

3. Indonesia:

C. NIC/Near-NIC Asia

1. Taiwan

2. Singapore

3. Hong Kong -- China, Special Administrative Region (SAR)

D. OECD Asia Pacific

1. Japan

2. South Korea

Chapter 3. Recent Developments in Middle-Distillate Retail Price Subsidies

A. China

1. EIA viewpoint

2. Managed float; indirect subsidies?

3. The 2013 reforms

4. Free market fears

5. Lagging prices; refinery investment

6. Guaranteed margins; pass-on

7. Consumption taxes/value added tax (VAT)

8. Last word

B. India

1. Gas oil / diesel vs gasoline subsidies

2. The burden

3. A look at LPG

4. Kerosene corundum (sic)

5. Taxes

C. Indonesia

1. Subsidy reform

2. The reform program

3. Pending reforms

D. Survey of other major gas oil / diesel market countries

1. Malaysia

2. Thailand

Chapter 4. Asia Pacific: Comparing Light-Ends and Middle Distillate Growth

A. Analysis Drivers -- Light-End Products

1. LPG

2. Gasoline

3. Naphtha

B. Analysis Drivers -- Mid-Barrel Products

1. Kerosene

2. Gas oil / ADO

C. Forecast/Outlook - By sector: Demand Giants vs West

1. Sector focus on transport and petrochemicals

2. Comparison of Growth Rates in OECD vs NIC/Near NIC vs Developing Asia Giants

3. What prospects should US exporters watch for?

Chapter 5. Product Quality Premiums

A. The Nature of tightening product specifications: One-directional, progressively cumulative, and irreversible 

B. Product premiums yet to justify high-cost, high-quality investment -- why?

1. Quality and refining

2. Quality and gas-to-liquids (GTL) plants

C. How long will it take for maturing developing Asia quality standards to catch up with OECD and NIC levels?

D. What marketing parameters should US exporters follow in selling products based on quality?

Chapter 6. Conclusions

Asia Oil Takeovers Match US Pace For First Time -- Bloomberg

Updates

December 5, 2012: link to SeekingAlpha.com.

Chinese oil giant China Petrochemical Corp. (SNP), otherwise known as Sinopec, will buy a 20% stake in Total S.A.'s Nigerian offshore oil field for $2.5 billion. This expands Sinopec's overseas asset portfolio significantly. Like its other two leading Chinese oil and gas firms, Sinopec has been attempting to secure its country's energy future globally while Total needs the cash to finance its explorations.

Later, 10:22 pm: amazing. Rigzone.com picked up the same story. 

Original Post

Two things that jump out: of course, the headline -- Asian oil takeovers match the US for first time ever, and, the future date that was referenced: 2015. That's just around the corner. Before the next presidential election. Wow. It's going to be a wild four years. And, oh, by the way, a thank you to Don for sending me this story.

For global warming enthusiasts: note that China's energy consumption and India's energy consumption will increase about 15 percent each over the next couple of years. It's very possible, due to energy conservation and the Great Recession of 2013, the energy consumption of the US will decline during this same period. Certainly it will not increase anywhere near that projected for China and India.

Both China and India are exempt from the Kyoto Protocol -- they are developing nations. Okay.

Link to Bloomberg.

“There are so many more options for Asian companies now with new discoveries around the world. The trend will be led by China, which has a large foreign- exchange reserve and is seeking hard assets.”

China’s energy use is projected to rise 16 percent to 124.2 quadrillion British thermal units by 2015 from 2011 levels, according to U.S. Energy Information Administration data.

Consumption in India will gain 14 percent to 27.8 quadrillion Btu, while South Korea will increase 6.7 percent and Japan 4.7 percent, according to the data.

China’s foreign-exchange reserves were $3.29 trillion, the world’s biggest, as of September, according to data compiled by Bloomberg. Japan, with $1.2 trillion as of October, had the second-biggest holding. 

The hook at the link: Record Asia Oil Takeovers Match U.S. Pace for First Time: Energy

EIA IEA EIA IEA EIEIO AND OIL

IEA:

After posting near-zero annual growth in the fourth quarter of 2011, global oil demand growth will gradually accelerate throughout 2012, culminating in an increase of 1.2 million b/d by this year’s final quarter, the International Energy Agency said in its latest monthly oil market report.

Global oil consumption is set to rise by 800,000 b/d this year to 90 million b/d, unchanged from the agency’s previous report, with gains in developing countries more than offsetting declining demand within countries of the Organization for Economic Cooperation and Development.

EIA:  The EIA suggests the price of oil to stay "high," despite plenty of supply. 

Tension between Iran and the West is likely to keep oil prices high despite a dramatic improvement in world supply and a big build in stocks, the International Energy Agency (IEA) said on Friday.

The agency said global oil supply rose 600,000 barrels per day (bpd) to 91 million bpd in April and was now 3.9 million bpd over year ago levels, with 90 percent of the increase coming from OPEC.

Saudi Arabia has said it pumped 10.1 million bpd last month, its highest for more than 30 years, in a bid to meet growing demand and curb oil prices, which hit a three-and-a-half-year high in March.