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Page added on October 14, 2018
IEA: Expensive Energy Is Threatening Economic Growth
Expensive energy is back and it is threatening global economic growth, the International Energy Agency (IEA) said in its Oil Market Report on Friday, joining other organizations like the International Monetary (IMF) and OPEC that also expressed this week concerns about mounting challenges to economic and oil demand growth.
Brent Crude prices have been holding above $80 a barrel, while pipeline constraints have caused WTI Crude prices to lag somewhat, the IEA said in its report, but noted that “Nonetheless, our position is that expensive energy is back, with oil, gas and coal trading at multi-year highs, and it poses a threat to economic growth.”
Emerging economies are grappling not only with higher energy prices, but they are also seeing their currencies depreciate against the U.S. dollar, which increases the threat of economic growth slowing down, the IEA said.
Earlier this week, the IMF slightly downgraded its projection for global growth for this year and next—at 3.7 percent, growth is now expected 0.2 percentage point lower than IMF’s forecast from April this year. The key reasons for the downgrade included trade disputes, geopolitical tensions, and a weaker outlook for emerging economies due to higher oil import bills, among other factors, according to the IMF.
On Thursday, OPEC revised down its oil demand growth estimates for this year and next—a third downward revision in three months—citing potential headwinds to global economic growth ranging from trade disputes to weakening finances in emerging markets and geopolitical challenges. OPEC revised down its global oil demand growth to 1.54 million bpd this year, down by 80,000 bpd from the estimate in the September report. The cartel now sees global oil demand growth next year at 1.36 million bpd, down by around 50,000 bpd from last month’s assessment, to reflect expectations for lower economic growth for Turkey, Brazil, and Argentina.
On Friday, the IEA also downgraded oil demand growth forecast for 2018 and 2019 by 110,000 bpd for both years, to 1.3 million bpd this year and to 1.4 million bpd next year, respectively, on the back of a weaker economic outlook, trade concerns, higher oil prices, and a revision to Chinese data.
38 Comments on "IEA: Expensive Energy Is Threatening Economic Growth"
Denial on Sun, 14th Oct 2018 10:51 am
No shit! I still see a lot of wasted energy around the world though. Western world could cut usage by 30 percent easily without effects of losing jobs.
rockman on Sun, 14th Oct 2018 12:22 pm
“…while pipeline constraints have caused WTI Crude prices to lag somewhat…” The absurd “logic” behind such a statement s baffling. I have to wonder if the EIA made such a point. IOW difficult getting oil out of the Permian Basin (and thus LESS OIL REACHING THE MARKET PLACE) puts downward pressure on oil prices? So suddenly if hundreds of thousands OF bbls per day of PB were to be available to refineries the oil prices would INCREASE?
I AM THE MOB on Sun, 14th Oct 2018 12:53 pm
Looks like that peak oil zombie is back!
Call up Heinberg and Kunt we are getting the band back together!
denial on Sun, 14th Oct 2018 1:02 pm
I think the people that write these reports are half asleep as are most of the people reading them are…
twocats on Sun, 14th Oct 2018 1:09 pm
I can sell you oil at the same price everyone else around the world is buying it – $80 a barrel.
But I have to hire a truck driver and go down a dirt-bike-path for 500 miles dodging cows before I can get it to a refinery and shipping port.
Okay – $70 a barrel.
Deal.
shortonoil on Sun, 14th Oct 2018 1:37 pm
To determine the cost of crude to the economy we use the total cost of crude (WTI) vs World GDP. That eliminates the constant changes in the value of the dollar. The total cost of crude is now 3.3% of world GDP. The 58 yearly average has been 2.48%. Crude is now overpriced from its long term average by 33%. Every time over the last 58 years that the total crude cost vs. world GDP exceeded 3.12% the world has gone into a recession. At $100/ barrel the ratio would be 4.4%. Most likely a very severe depression that would result in massive capital destruction. The impact of oil on the economy is greatly under estimated by most analysts. Its average 58 year leverage in the economy has been 53:1. the hills group dot org
Davy on Sun, 14th Oct 2018 1:59 pm
“The impact of oil on the economy is greatly under estimated by most analysts.”
And greatly overestimated here.
I AM THE MOB on Sun, 14th Oct 2018 2:35 pm
Great comment short like always..Just ignore davy he is a stupid uneducated hick farmer…Product of incest most likely..
I AM THE MOB on Sun, 14th Oct 2018 2:40 pm
During the mid/late 20th century (1960-1999), a barrel of oil cost $19 on average; during the years immediately prior to the Great Recession (2000-2008), the average price of a barrel of oil had increased to $47; and during the years immediately following the Great Recession (2010-2012), the average price of a barrel of oil had further increased to $81. During the same three time periods, the average price of a metric ton of copper increased from $3,085, to $3,713, to $6,817; the average price of a metric ton of iron ore increased from $36, to $57, to $124; and the average price of a metric ton of potash increased from $114, to $185, to $343. (Prices are inflation adjusted.)
The simple fact is that we cannot grow our global economy and improve our global material living standards on $55 oil, $6,817 copper, $124 iron ore, and $343 potash like we did on $19 oil, $3,085 copper, $36 iron ore, and $114 potash. It should come as no surprise that our Non Renewable Resource-dependent global economy experienced the Great Recession during 2009. Nor should it come as a surprise that we have yet to recover from the Great Recession. Nor will our industrialized and industrializing economies ever recover, so long as price levels associated with the vast majority of Non Renewable Resources remain at their inordinately high levels.
Christpoher Clugston
Scarcity: Humanity’s Final Chapter
onlooker on Sun, 14th Oct 2018 2:41 pm
They’re is NO Goldilock price anymore. Either Oil is too expensive for the consumers or too cheap for the Producers
I AM THE MOB on Sun, 14th Oct 2018 2:43 pm
Oil Basics and The Limits to Economic Growth
The average real price of oil since 2005 is 2.5 times higher than in the period 1986-2004. Even at today’s depressed oil prices, the real price of oil-$55 per barrel—is 55% higher than the in 1986-2004 of $34 per barrel. Economists and politicians cannot understand why the economy won’t grow but never consider the underlying cost of energy.
Energy is the economy and oil is the master energy resource. The global economy developed when oil prices averaged $34 per barrel. When oil prices increased to more than $85 per barrel after 2005, economic growth could not continue. No business can withstand a 2.5-fold increase in underlying cost and make a profit. Although oil prices are lower since the price collapse in 2014, they are still 50% higher than in the 1990s.
Economic growth is unlikely at these underlying energy costs.
Source: Art Berman
http://www.artberman.com/oil-basics-the-limits-to-economic-growth/
Source: IEA
http://www.iea.org/textbase/npsum/high_oil04sum.pdf
Source: IMF
https://www.imf.org/external/pubs/ft/oil/2000/
Davy on Sun, 14th Oct 2018 2:57 pm
“Christpoher Clugston Scarcity: Humanity’s Final Chapter”
Got a link dumbass?
Are those his words or yours? dumbass
Davy on Sun, 14th Oct 2018 2:59 pm
“Economic growth is unlikely at these underlying energy costs.”
SLOB, I can’t tell what you are writing or what you are referencing. Try again. idiot
Anonymouse1 on Sun, 14th Oct 2018 3:06 pm
The turd is fighting with own sock again. What happens when a dumb-ass lunatic feels he is not the receiving attention he feels he is entitled too.
Davy on Sun, 14th Oct 2018 3:07 pm
The above two posts are not mine.
Everyone here knows by now that I never revert to childish insults and put downs, and I rarely ever lose my shit like the moron did above.
I AM THE MOB on Sun, 14th Oct 2018 3:13 pm
See Davy I did it again. You mess with me and I will steal your handle.
Anonymouse1 on Sun, 14th Oct 2018 3:15 pm
MOB, good work keep it up Davyturd has to be driven off this board
GregT on Sun, 14th Oct 2018 3:16 pm
Sorry pals, didn’t you notice my signature expression:
“revert to childish insults and put downs”
I take credit
JuanP on Sun, 14th Oct 2018 3:17 pm
Good to have you back Greg. Stick around and we will get the gang back in action.
GregT on Sun, 14th Oct 2018 3:47 pm
Hey thanks Juan, good to be back.
Anonymouse1 on Sun, 14th Oct 2018 3:48 pm
Davytard is making fake posts as (me). As you all know, or should, I dont ‘high five’ I AM THE DAVYTURD’. Or ‘MOB’ as you some like to call him.
Grow up dumbass. I am going to guess Wall-Greens got shorted on their shipment autism pills this week, and he’s starting to feel the effects.
JuanP on Sun, 14th Oct 2018 3:49 pm
When Mak wakes up let’s give Davyturd hell!
Anonymouse1 on Sun, 14th Oct 2018 3:50 pm
Greg, glad you are back and count me in.
makati1 on Sun, 14th Oct 2018 6:17 pm
Mak is awake! Welcome back GregT. It is Monday AM here in the Ps. The roosters are crowing and the sun is shining. Another good day in the making.
Haven’t checked on world events yet, but I may post a comment on one of them here later. Too bad the site owner doesn’t eliminate the multiple avatars for the same person. I try to avoid them, but it gets confusing since I don’t keep a list of who is who and where like Davy, the online stalker.
Davy on Sun, 14th Oct 2018 6:22 pm
Shut up billy the online asswipe. Keep it up if you want your clock cleaned.
Davy on Sun, 14th Oct 2018 6:23 pm
you really missed gregt, wow, sounds passionate.
Anonymouse1 on Sun, 14th Oct 2018 8:09 pm
Mak, that wasnt GreGt, or Juan, and 1/2 of the posts up there from ‘me’ are fake as well.
I AM THE DAVYTURD, aka ‘MOB’, has been fooking around, being you know, himself.
Cloggie on Sun, 14th Oct 2018 8:17 pm
Davy is NOT the MOB, but they both f* up this forum via identity theft. Most of all MOB.
JuanP on Sun, 14th Oct 2018 8:46 pm
My name was used by someone else again above. How childish does a person have to be to do shit like that? I never stop to be amazed by the behavior of some of the freaks that visit this place.
makati1 on Sun, 14th Oct 2018 9:00 pm
Davy is insane and should be banned. Eventually all of us sane people are going to just move away and leave the site to Davy and his insanity.
Is there a real moderator who gives a damn? Does every click make a buck for the site owner? I don’t see any other reason to allow what is happening here for so long.
Anonymouse1 on Sun, 14th Oct 2018 9:18 pm
Its Davyturd, via his long-time sock(idiot), I AM THE DAVYTURD. Simple as that.
Anonymouse1 on Sun, 14th Oct 2018 9:20 pm
The exceptionalturd loves to maintain plausible deniability. But not his sanity. That is far less important….
Cloggie on Mon, 15th Oct 2018 1:28 am
Davy is insane and should be banned. Eventually all of us sane people are going to just move away and leave the site to Davy and his insanity.
Objection your honor!
This is one of the very few places in the entire internet, where moderators do not interfere. It is a pure Darwinian environment, with total free speech. If you like that (as I do), you should also accept all the shit that comes with it, including Davy.LOL
No bans.
Not even our resident sociopath milliMOB.
Free Speech Forum on Mon, 15th Oct 2018 1:53 am
People love to encourage others to smoke, get tattoos, get fat, drink, do drugs, be lazy, go in debt, and be immoral, but why doesn’t anyone suggest that people stop smoking, be clean-cut, exercise, be healthy, read, work hard, save money, and go to church?
Those who are conservative, religious, and moral don’t mind talking about morality, but those who immoral seem to prefer avoiding the subject.
Those who are immoral will try to justify their immorality, but even Atheists have consciences.
makati1 on Mon, 15th Oct 2018 2:25 am
But Cloggie, it is NOT a good site. It is full of psychopaths like Davy, MOB, the ‘tards’, etc., that are NOT adding anything intelligent to the conversation.
I don’t come on the PO site to be insulted/putdown by a delusional American hillbilly and his sock puppets. I come on to share my views and to debate the views of others and discuss current events.
People like Davy, MOB and the ‘tards’ only prove my assertion that the US is dying. Any intelligence is being destroyed by the constant brainwashing they are indoctrinated with 24/7/365.
I can debate my views without being called every derogatory name in the book every time I post something they don’t like. Again perfect examples of America in decline. Snowflakes who believe feelings are more important than rational though.
makati1 on Mon, 15th Oct 2018 2:32 am
“Do unto others as you would have them do unto you” is all you need to be moral. Organized religion is just another power grab by the lazy, over the ignorant.
If you are born into a Catholic family, you are indoctrinated as Catholic, Ditto if you are born a Protestant or a Muslim, or a Buddhist, etc. Religion is indoctrination/brainwashing, not a rational decision by an educated adult. The indoctrination is so perfect that few are able to escape it in later life.
Davy on Mon, 15th Oct 2018 5:04 am
“Mak, that wasnt GreGt, or Juan, and 1/2 of the posts up there from ‘me’ are fake as well.”
Listen to the serial board arsonist with the sock and handle stealing whining. The culprit is GregT. I caught him read handed. You dumbass that play this sock game and handle stealing games need to watch you vocabulary and dialect. You can be figures out. You are the biggest whining bitch, a-noise1, and you deserve any shit you get. You contribute nothing.
“Davy is NOT the MOB, but they both f* up this forum via identity theft. Most of all MOB.”
Total BS, the MOB fucks this board up. I try to post reasonable moderate post and moderate the extremist here who are disgusting. I am the primary target of the cowards that steal handles and play sock games. I don’t see you dumbasses whine about that.
“Davy is insane and should be banned. Eventually all of us sane people are going to just move away and leave the site to Davy and his insanity. Is there a real moderator who gives a damn? Does every click make a buck for the site owner? I don’t see any other reason to allow what is happening here for so long.”
Shut up you stupid old man, you are the one that invites this extremism. You best friend GregT is doing this sock puppet shit and handle stealing against me. You idiots know socks when you see them but as long as they are attacking me, well that is fine. You can obviously see when people are stealing my handle but you could give a shit when it is me. When it fucks the board up and you get caught in the middle well then the sky is falling. I suggest you dumbasses ask GregT to stop this activity.
“Objection your honor! This is one of the very few places in the entire internet, where moderators do not interfere. It is a pure Darwinian environment, with total free speech. If you like that (as I do), you should also accept all the shit that comes with it, including Davy.LOL No bans. Not even our resident sociopath milliMOB.”
Thanks neder, you are the only enemy I respect. At least you contribute and enjoy a good debate and offer a good fight. The stupid old man, billy can be shoved over with a big breath. A-noise1 doesn’t even make comments to debate. Gregt to is a pussy and we see what he engages in from the board issues we had yesterday.
Davy on Mon, 15th Oct 2018 5:15 am
“But Cloggie, it is NOT a good site. It is full of psychopaths like Davy, MOB, the ‘tards’, etc., that are NOT adding anything intelligent to the conversation.”
Geeze, billy, this site has been taken into the gutter by you. You are the psychopath that turns his hate of the US into a topic instead of energy.
“I don’t come on the PO site to be insulted/putdown by a delusional American hillbilly and his sock puppets. I come on to share my views and to debate the views of others and discuss current events.”
Shut up stupid old man, you put me down on a regular basis hypocrite. Lately especially I have decided to ignore your disgusting extremism that attacks me as an American but when you call me out by name I give you an ass-kickin. You like it because it stirs up shit. Look at you whine when you are the primary culprit for stirring shit up.
“People like Davy, MOB and the ‘tards’ only prove my assertion that the US is dying. Any intelligence is being destroyed by the constant brainwashing they are indoctrinated with 24/7/365.”
NO shit, your assertion “US is dying 24/7/365” is your extremist agenda not energy. You are now on the record.
“I can debate my views without being called every derogatory name in the book every time I post something they don’t like.”
You have no respect for others and this has proven so many times over the years when you have run off good people because you would not moderate your extremism that is a ““US is dying 24/7/365”. You indirectly and directly put people down billy. I will be on your ass when I see a stupid comment that is not factual or is a outright lie which you do on a regular basis.