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Page added on May 11, 2015
OPEC Sees Oil Price Below $100 a Barrel in the Next Decade
Oil prices will remain below the psychologically important $100-a-barrel mark until at least 2025, according to a draft report by the Organization of the Petroleum Exporting Countries (OPEC), seen by The Wall Street Journal.
In its most optimistic scenario, OPEC, which represents 12 oil-producing countries, forecast that oil will sell for around $76 per barrel in 10 years’ time, according to the report.
However, it warned that crude oil could cost as little as $40 per barrel in 2025.
“$100 is not in any of the scenarios,” said a delegate at an OPEC presentation last week in Vienna, according to The Wall Street Journal.
OPEC has refused to cut its output following a 60 percent crash in oil prices that began in June last year. Brent and WTI crude prices have partially recovered from the lows seen at the start of 2015 to trade at around $65 and $59 per barrel respectively.
The draft report seen by the newspaper recommended that OPEC reintroduce the quota system it largely abandoned in 2011, which limited how much oil each member country could produce.
7 Comments on "OPEC Sees Oil Price Below $100 a Barrel in the Next Decade"
Speculawyer on Mon, 11th May 2015 9:12 pm
OPEC says . . . “Please remain addicted to oil. Keep buying big gas guzzlers. Don’t worry, be happy. Just keep buying our oil.”
Its not like they have a vested interest, right?
BobInget on Mon, 11th May 2015 11:37 pm
By this time next year OPEC will be under different management.
Bank on it.
.
q on Tue, 12th May 2015 1:16 am
BAU forever 🙂
Nony on Tue, 12th May 2015 2:37 am
Still waiting for James Hamilton to eat his crow. It’s not just that he was wrong, but that he fails to discuss it. And that he has a habit of being wrong in a certain direction. Oh…and he does not think like a micro guy.
BobInget on Tue, 12th May 2015 10:45 am
Rig Count DOWN, Not in KSA.
Lifted from another energy board. OT
Saudi’s rig count has been on the upswing for this whole decade.
Doesn’t seem related to just November’s OPEC decision.
You don’t have to be Matt Simmion’s ghost to wonder if you need more than 20 rigs to keep 10 million of production going out of fields that have been pumped hard for fifty years.
The very sharp increase in rig count in Saudi (and Kuwait BTW) over the last couple of years could be the most important information that failed to trigger many comments.
It simply proves that they need to drill advanced wells (extended directional/horizontal) to maintain production.
In the fantastic reservoirs they have been producing for 50 years+ this is bad omen.
Fantastic not only by their geographical extension but more importantly by their very high porosity/permeability.
Such reservoirs tend to empty a bit like a bath tube. Once you reach the peak production per reservoir (which I think is the case for most of them) the decline can be precipitous;
Remember Cantarell in Mexico. Nobody talked about it until it starts its decline and in a matter of a couple of years the production decreases by more than 50%
BobInget on Tue, 12th May 2015 11:24 am
I believe the Saudis are currently pumping over 12 M B p/d Not ten million as is
reported.
Iran, Russia and Iraq) are responding by
increasing production. IOW’s there is much MORE oil being used (consumed) then realized.
As I’ve been saying, that ‘oil glut’
was confined to the US. That ‘glut’ could have been shortened by cutting back on imports. It was not. In fact, imports increased.
My theory remains the same. Iran and Saudi Arabia have been at war for five years. Only now do we realize it.
Almost every observer has maintained the proxy war in Syria would spill over. Now that’s obvious, even coked up traders are beginning to understand.
The Royals in Saudi Arabia are in deep trouble and they too are feeling heat.
Dictatorships, in particular, well healed ones, don’t give up easily. Don’t expect any overnight changes. Do expect a long drawn out painful sand in the clusterfuck.
Currently we have over 30 million refugees
worldwide. Most, it’s true, as a result of climate changes caused wars and unemployment. Most of that 30 million are what we in the West call ‘homeless’.
In Syria alone three million displaced persons
homeless. In the last five years of Syrian war (between Iran (Russia) and KSA (USA)
millions more are roaming the planet seeking shelter.
Mind you, when Israel displaced Palestine’s
indigenous population in 1948, ‘only’ 400,000 were rendered stateless. Those people, the Palestinians, generations later,
are still making trouble for Israel.
Today, we have 30 million refugees to feed buy can we?
BobInget on Tue, 12th May 2015 11:28 am
OPEC crude oil production rose by 18,000 barrels per day while global oil supply fell by 390,000 barrels per day in April, according to the organization’s latest report on Tuesday.
OPEC’s output rose to 30.84 million barrels per day, mb/d, from 30.82 mb/d in March. Global oil supply in April dropped to 94.1 mb/d, less than 390,000 barrels per day, b/d, compared to last month. The share of the organization’s crude in total oil output rose from last month’s 32.6 percent to 32.8 percent. The highest contribution to OPEC’s production rise came from Saudi Arabia with over 10.09 mb/d and Iraq with over 3.67 mb/d.
Demand for OPEC crude is forecast to be 29.3 mb/d for this year, 300,000 b/d more than the previous year due to the fall in non-OPEC production and the increase in global oil demand, the report shows.
Non-OPEC supply forecast for the year was reduced by 10,000 b/d to 57.16 mb/d. An increase in non-OPEC supply, especially in the first half of the year, is expected although it is to be slow due to “low oil price expectations, the declining number of active rigs in North America, the decrease in drilling permits in the U.S. and the reduction in the 2015 spending plans of international oil companies,” the report says.
Non-OPEC oil supply in 2014 was 56.48 mb/d.
The report showed a 50,000 b/d increase in the expectation for global oil demand to total 92.5 mb/d for this year. The organization had previously forecast global oil demand to be 92.45 mb/d. Demand is expected to rise by 1.18 mb/d, higher than last month’s prediction, with “positive revision to OECD Europe.” Global oil demand was 91.32 mb/d in 2014.
In March, 293 drilling rigs were shut down globally including 205 oil and 88 natural gas rigs. In the Americas, 239 rigs were closed and in OPEC countries the number closed was 12.
The report is the last one before the 167th OPEC meeting to be held on June 5 in Vienna, Austria.