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56 comments on Has OECD oil consumption peaked?
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56 comments on Has OECD oil consumption peaked?
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By coincidence I just posted this in yesterday's drumbeat. Feel free to knock it down :-)
Here's OECD imports (IEA OMR Table 8).
And this time just total shown to get a better scale.
Note that total imports to OECD countries peaked in 2005. However imports from all regions (other than core OPEC) known to be increasing production over the period actually increased through 2007 only levelling off in 2008. Russia/Former Soviet Union OECD import data in particular seems to be a good calibration source as their production data seems to be far more reliable than OPEC. Even though core OPEC claimed some production increases absolutely none of that showed up recently in OECD members countries. Increased FSU, African and Iraqi production did show up.
I suspect the blue bars might be reasonably proportional to true world C+C production and match up with Simmons's "shady" data (showing 2008 production down about 2mb/day on 2005). If this is true then it follows that recent consumption in particular in non-OECD countries has been overestimated in IEA/EIA data to balance the inflated production figures.
Another curiosity.
Here's imports from Saudi tracked in OECD countries by grade plus totals over the last decade (from IEA OMR Table 6)
Light exports to OECD peaked in 2002 at 2.84 mb/d
Total exports to OECD peaked in 2003 at 4.65 mb/d
Isn't Saudi Arabia exporting oil to China? It seems like some country must be doing so, and a country relatively in Middle East seems much more likely than one from, say, the Americas. This, and exports to some other countries like India and developing nations, could explain a fair amount.
Clearly producers export to non-OECD nations - it's just that recently we have to assume all of their supposed extra production and more is going to non-OECD countries despite all Bush/Cheney's visits. And Kuwait is even worse - they must absolutely hate the west. Our "pals" in the middle east obviously don't like us very much if "official" production figures are correct. Iran on the other hand seems to like the west as they export pretty much the same proportion of production to Europe as they did a decade ago according to the IEA. Been disagreeing a bit with memmel on this but I think Iranian production figures might be some of the most accurate in the middle-east. Not sure how much that says though :-)
I really do think that the overall picture makes more sense if we really peaked for good in 2005, started to fall significantly in 2007 thus igniting the price of crude then the financial system crashed spectacularly also crashing rapidly real demand.
I also realise that this scenario would suggest real OPEC spare capacity after cuts right now is a lot closer to 1mb/day than the 4.5 (or is it up to 5.5 now?) that is currently claimed. In this case decline will outpace demand again and prices will shoot back up again near the end of this year/early next - unless major additional demand destruction happens first.
The IEA forecasts that Q4 world consumption will be slightly lower than Q3 world consumption this year which would not normally be the case unless there's a huge price jump or a further massive economic shock to come in Q4. Wonder which one they expect? They may give some explanation for this in the full latest OMR but only the highlights are available to non subscribers for another week or so - not the full report.
I think that is what I showed in figure 07, 08 and 10 in my post.
If prices again shoot up (i.e. increases by more than 50 % above today’s levels) I would expect a new round of demand destruction/adjustments as historical data suggests that most economies cannot sustain such a price shock.
Prices may temporarily spike even higher, but there is little that supports that most economies can absorb dramatic price changes as of now.
I agree that the official figures show that's where it all went. But taking the lead from Simmons I just don't believe them. I hope I'm wrong in thinking that the numbers just "feel" more right and it's much easier to match IEA import data with production if you knock just a few key producers down a bit in line with Matt's odd data - because if he's right then we are in much worse shape than even most TOD readers realise. I get the sinking feeling that his numbers may be from an internal IEA database, after all he has claimed repeatedly that the IEA has two sets of numbers - one set for public distribution and another set in private; but if we're lucky he's just gone mad and made them up :)
In keyposts I realise that TOD staff in general have to work with the official data or it would be a complete mess and your post is greatly appreciated - don't take my mutterings as a criticism in any way shape or form. Just a "what-if"?
Hi Undertow I think the key to Iran is net exports. Iran like Mexico reimports a significant amount of finished product since it does not have enough internal refining capacity. Next they have substantial internal demand. Thus the issue becomes how good are the finished product import numbers and how are they balanced against exports. Also for Iran in general Iranian crude is of low quality one big reason they choose not to refine it themselves since optimized refining requires complex refineries. Thus the real situation in Iran is made complex by differences in the rate and amount of gasoline imported vs oil exported. These have no intrinsic reason to balance.
http://www.upi.com/Energy_Resources/2009/03/16/Iran-to-import-gas-throug...
http://www.iranfocus.com/en/iran-general-/irans-april-march-gasoline-imp...
I'd suggest that the "evidence" if you will points to falling production and higher imports of gasoline to offset the difference. How much is growth in internal demand and how much is a true overall decline is probably almost impossible to determine. I pointed this out to WT long ago when he introduced the export land model that many producers may use the export land concept to mask overall declines in production until the numbers become untenable.