Saturday, November 21, 2009
The Future of Global Oil Supply: Understanding the Building Blocks
Predicting Supply in a Complex World Fears about "running out" of oil are recurrent. At their strongest, they coincide with periods of high prices and tight supply-demand balance. The latest such period of "peak oil" concerns became very evident from 2004, when strong oil demand ran up against capacity constraints.
In contrast, IHS CERA’s reference case for global liquid productive capacity shows growth through 2030 to around 115 million barrels per day (mbd) and finds no evidence of a peak in supply appearing before that time.
Hydrocarbon liquids—crude oil, condensate, extra heavy oil, and natural gas liquids—are a finite resource; but based on recent trends in exploration and appraisal activity, there should be more than an adequate inventory of physical resources available to increase supply to meet anticipated levels of demand in this time frame.
Post-2030 supply may well struggle to meet demand, but an undulating plateau rather than a dramatic peak will likely unfold. Moreover, if the "peak demand" now evident in the OECD countries is a precursor of later developments in the emerging markets, world demand itself could eventually move on to a different course. More >>>