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Economics Oil Gas
Economics Oil Gas
University of Petroleum
&
Energy Studies
Energy Outlook
Role of Oil & Gas
Coal was once again the fastest growing fossil fuel, with
predictable consequences for carbon emissions.
Oil & Gas Value Chain
Economic Composition of
Oil and Natural Gas Industry
Complexities
Global Industry, few dominant producer, high technology and high capital
Linked to national developmental initiative, global environmental impact
Limited natural resource, linked to shipping and pipeline industry, capital
market interface, future market
Natural Gas Value Chain
Specialized Supply Chain
Complexities
Evolving Industry, local trading practices, few dominant producer, high
technology and high capital, transnational pipeline transportation, Gas to
Liquid and Liquid to Gas conversion
Cost build up of pump price of Petrol
The following tables are estimates of the various cost components that
make up the pump price of gasoline. The tables are based on a variety of
sources and assume a crude oil price of $49/B and an average pump price
of $2.00/gallon.
Oil prices hit an all-time record high. Yet the revolution in shale gas
production drove US natural gas prices lower, reaching record
discounts to oil.
Energy Consumption from non OECD
The loss of Libyan supplies early in the year, combined with smaller
disruptions in a number of other countries.
Production of Oil
On the production side, the loss of oil supplies in Libya and elsewhere was
eventually more than offset by large increases among Middle Eastern OPEC
members, leading to record oil production in Saudi Arabia, the UAE, and Qatar.
The example of North America highlights how competition and a level playing
field foster innovation, ultimately leading to the production of previously
inaccessible, new, „unconventional‟ resources.
Production of Oil
Annual global oil production increased by 1.1 million b/d, or 1.3%. Virtually
all of the net growth was in OPEC, with large increases in Saudi Arabia
(+1.2 million b/d), the UAE, Kuwait and Iraq more than offsetting a loss of
Libyan supply (-1.2 million b/d).
Output reached record levels in Saudi Arabia, the UAE and Qatar.
Non-OPEC output was broadly fl at, with increases in the US, Canada,
Russia and Colombia offsetting continued declines in mature provinces such
as the UK and Norway, as well as unexpected outages in a number of other
countries.
The US (+285 tb/d) had the largest increase among non-OPEC producers
for the third consecutive year. Driven by continued strong growth in onshore
production of shale liquids, US output reached the highest level since 1998.
Production of Oil in 2011
Oil Consumption
Non-OECD countries accounted for all the net increase, rising by 685
tb/d.
Changing outlook for energy production & use may redefine global
economic & geopolitical balances
As climate change slips off policy radar, the “lock-in” point moves closer &
the costs of inaction rise
The gains promised by energy efficiency are within reach & are essential to
underpin a more secure & sustainable energy system
Review of Salient points