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Page added on June 16, 2017
Robert Rapier: Global Oil Demand Hits New Record High
Despite sensationalistic projections that oil demand could peak soon — which is one factor making the oil markets skittish — global demand growth for crude oil remains high. That’s been consistently shown by the International Energy Agency, and this week it was confirmed with the release of the BP Statistical Review of World Energy 2017. In fact, the report shows that oil demand has never been higher than it is today.
For readers who don’t know, I consider the BP Statistical Review to be the bible of energy statistics. The report provides a comprehensive picture of supply and demand for fossil fuels, nuclear power, and renewables on a country-level basis. I view it as the best source of energy information that is widely available to the public, and after each year’s release in June, I spend a lot of time creating graphics for use in future articles.
As always, in upcoming issues of The Energy Strategist, I will explain the global energy picture graphically using data from the report, and take a deep dive into what the numbers mean. Today, I want to focus briefly on one category — global demand for oil.
Over the past ten years, global demand for oil has increased by 10.8 million barrels per day (BPD). The average annual increase over that time was 1.1 million BPD. Last year’s increase of 1.6 million BPD was the 3rd largest increase of the decade:
The growth of crude oil demand has been remarkably consistent since the early 1980’s. You can draw a pretty straight line through demand growth from ~1983 through 2016.
So if the demand side is so robust, what’s wrong with oil prices? As it so happens, the production side has been even stronger, and that has led to record high inventories around the world.
Speaking of inventories, this week has been like deja vu all over again. A week ago the American Petroleum Institute (API) reported a significant crude oil inventory drop (bullish news), before the Wednesday release of the EIA’s Petroleum Status Report. But then the EIA report contradicted the API and reported a crude oil storage build of 3.3 million barrels. The bearish EIA report then drove crude prices down by 5%, and along with it the entire energy sector.
This week, the API reported a surprise crude oil build of 2.8 million barrels, and oil sold off. Then on Wednesday, the EIA reported a crude oil drop of 1.7 million barrels, but a gasoline inventory increase of 2.1 million barrels. Both of these numbers were interpreted as bearish, because a larger crude oil drop was expected, and the gasoline build fans fears of weakening demand at the start of summer driving season. Once again, oil prices fell by 4%.
The oil markets are so skittish that any bearish signs on inventories have consistently trumped any bullish inventory news. That happened last week, it happened this week, and it will probably be the status quo until crude inventories make consistent and significant moves back down toward historical averages. The market in recent months has been such that five consecutive declines in inventories can be overshadowed by one small increase, but that’s the world we live in at the moment.
18 Comments on "Robert Rapier: Global Oil Demand Hits New Record High"
cia on Fri, 16th Jun 2017 3:15 pm
https://www.reddit.com/r/collapse/comments/6g2d7j/collapse_of_global_civilization_by/
cia on Fri, 16th Jun 2017 3:39 pm
http://imgur.com/a/W85ZN
Coffeeguyzz on Fri, 16th Jun 2017 3:59 pm
Conundrum …
If a doomer is overwhelmed with evidence that “The end of my apocalyptic vision is – itself – doomed, what’s a perennial fatalist to do?
Would that thermodynamic thang ‘splain it?
Enquiring minds wants ta know …
Davy on Fri, 16th Jun 2017 4:07 pm
Coffee, it is not that complicated. We are all doomed. We all just live to die another day. Doom is healthy and justified. The problem arises when it is used to forcast and predict instead of risk management.
Apneaman on Fri, 16th Jun 2017 6:42 pm
We are on a path to human extinction, says former Microsoft exec
“The reality is, that on the path we are on, we have a maximum of 10 years prior to human extinction,” Shively told council members.”
https://mynorthwest.com/664563/human-extinction-10-years/
Apneaman on Fri, 16th Jun 2017 6:46 pm
More more more……
Parts of Pittsburgh submerged after four days of flooding
Drivers stranded, cars submerged after heavy rain falls again
http://www.wtae.com/article/parts-of-pittsburgh-submerged-after-three-days-of-flooding/10031015
onlooker on Fri, 16th Jun 2017 6:47 pm
hmm, sounds like those in the know are sounding the alarm
https://www.forbes.com/sites/jimdobson/2017/06/10/the-shocking-doomsday-maps-of-the-world-and-the-billionaire-escape-plans/#6cfd3f0c4047
“With all of this knowledge of future mapping, do the world’s financial leaders know something we don’t? Consider how many of the richest families have been grabbing up massive amounts of farmland around the world. All property far away from coastal areas and in locations conducive to self-survival, farming and coal mining.”
Apneaman on Fri, 16th Jun 2017 6:47 pm
Unprecedented ‘flood of the century’ hits Manitoba town hard
https://www.theweathernetwork.com/news/articles/unprecedented-flood-of-the-century-hits-manitoba-town-hard/83236
Apneaman on Fri, 16th Jun 2017 6:50 pm
Cars, businesses suffer damage as flash flooding hits Roanoke
Roads looked more like rivers in downtown
“On Salem Avenue, water up to the mirrors caused cars to stall out and a few to be swept away. Phillip Trump ended up on the Martin Luther King Jr. Memorial Bridge.
“The water was coming up, I realized that the cars in front of me were not moving and my engine started to kind of act like it was gonna give way. So the first thing I did as soon as I saw this bridge here was just cut the wheel and come up over the curb, trying to save my engine,” said Trump.
Trump was making food deliveries to a nearby apartment when he stumbled onto the flooded roadways.
“(A police officer) was able to walk over and meet me and I then I was like, ‘OK, now what do I do,'” said Trump.”
http://www.wsls.com/weather/cars-businesses-suffer-damage-as-flash-flooding-hits-roanoke
Anonymous on Fri, 16th Jun 2017 7:42 pm
Demand is not the same thing as consumption. Oil analysts misuse the term and then don’t think about supply and demand properly.
Other than that, I agree that oil consumption AND production have been moving steadily higher. Peakers were wrong, wrong, wrongitty wrong wrong. TOD is dead, dead, dead. They just got sick of being wrong and snuck off.
onlooker on Fri, 16th Jun 2017 7:47 pm
Habitat Habitat Habitat
Climate change will leave an acceptable habitat for a few like jellyfish. The rest of life is screwed.
http://xwer.de/en/fte-013-biology-for-doomers
denial on Fri, 16th Jun 2017 8:36 pm
@apeman….thanks for the advertisements on drug usage….before you post a link please clean it up asshole….
twocats on Fri, 16th Jun 2017 9:04 pm
coffee – not relevant, double negative (The end of my apocalyptic vision is – itself – doomed) so not coherent, and the doom is proceeding quite nicely, thank you. Slowly, but nicely. it’s just at the current moment doom is happening primarily in climate and institutions.
but i’m sure if we pin all our hopes on LTO forever it will work out for at least the next two maybe even three whole years. for myself I’m glad the 2008 meltdown happened, allowed production to catch up to and outpace consumption; Gave me a whole decade to live it up and relax. If needed I’m sure we can generate a similar crises and extend this puppy another five or ten years as ecology and societies further unravel. Could have some fun moments.
Hubert on Fri, 16th Jun 2017 10:52 pm
We may have 30 years of oil left on this planet. I have yet to see a single country getting ready to deal with this problem.
Hubert on Fri, 16th Jun 2017 10:53 pm
My main recommendation…. Don’t have children. They have no future….
Anonymouse on Fri, 16th Jun 2017 11:30 pm
‘Demand’ for oil will be always be high. Even as more people and countries can afford less of it. ‘Demand’ will continue to be ‘strong’, even if there were less of it go around, or is becomes ever more expensive and time-consuming to extract. Demand might soften or vary as recessions come and go as well, but overall, ‘demand’ for oil will still be brisk, even if the economy is tanking. The reason for this ‘demand’, and its persistence, is rather simple. Oil runs everything. ‘Demand’ for the product, is literally baked into the system.
Would be like saying, ‘I project strong demand for food in the future’. Or clean water etc etc.
DerHundistlos on Sat, 17th Jun 2017 12:16 am
Onlooker-
EXACTLY SPOT ON.
shortonoil on Sat, 17th Jun 2017 6:42 am
According to the EIA in 2016 6.35 Gb of crude went into US refineries, 3.89 came out as finished product. In 2005 6.14 Gb went in, 5.69 came out.
It is not hard to figure out where the demand is coming from. When the raw material cost exceed the value of the finished products produced refineries will reduce utilization and demand will fall.
http://thehillsgroup.thehillsgroup.info/p/040217refinery-yieldsthe-et-model-is.html