Factors Affecting Oil and Product Prices Rayola Dougher API Senior - - PowerPoint PPT Presentation
Factors Affecting Oil and Product Prices Rayola Dougher API Senior Economic Advisor The price of oil has fluctuated sharply before Inflation-adjusted 2014 $/barrel 160 Low spare capacity 140 Libyan Uprising 120 PDVSA strike Iran/Iraq
Rayola Dougher API Senior Economic Advisor
20 40 60 80 100 120 140 160 Iran/Iraq war Gulf War OPEC cuts 4.2 million 9/11 Low spare capacity Recession Libyan Uprising Supply surplus
Inflation-adjusted 2014 $/barrel Sources: Inflation-adjusted average refiners acquisition price for crude oil
PDVSA strike Iraq War Asian Growth
$0.00 $1.00 $2.00 $3.00 $4.00 $5.00 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Crude Oil $1.18 Gasoline $2.46 Diesel $2.93
Average prices as of March 6, 2015
Sources: NYMEX (WTI crude oil) and AAA (gasoline and diesel)
Source: EIA
Growth in Global Oil Supply Disruptions (mmb/d)
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 Jan 2012 Jul 2012 Jan 2013 Jul 2013 Jan 2014 Jul 2014 Jan 2015
OPEC Non- OPEC
Growth in U.S. Crude Oil Production* (mmb/d)
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 Jan-2012 Jul-2012 Jan-2013 Jul-2013 Jan-2014 Jul-2014 Jan-2015
Source: EIA * Includes hydrocarbon gas liquids, biofuels, and refinery processing gains.
0.5 1 1.5 2 2.5 2014 2015 2016 Production Consumption
Source: EIA, Short-term Energy Outlook, February 2015
(million barrels per day)
4 5 6 7 8 9 10 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
U.S. Crude Oil Production (millions of barrels per day)
Source: EIA
>73% growth 2008 to 2014
Current and prospective resources and basins in the continental US
Source: EIA based on data from various published studies – updated May 9, 2011 Current Shale Resources Prospective Shale Resources Basins Shallowest/ Youngest Mid-Depth/ Mid-Age Deepest/Oldest
Shale Resources, Lower 48 States
Stacked Resources
0.5 1 1.5 2 2014 2015 2016 OPEC North America Russia and Caspaian Sea Latin America North Sea Other Non-OPEC
Million barrels per day
Source: EIA, Short-term Energy Outlook, February 2015
1 2 3 4 United States Canada Brazil China Oman Australia Malaysia India Norway Sudan/S. Sudan Other North Sea Kazakhstan Vietnam Gabon Colombia Russia Syria Egypt Azerbaijan Mexico United Kingdom 2016 2015 2014
(million barrels per day)
Source: EIA, Short-term Energy Outlook, February 2015
0% 10% 20% 30% 40% 50% 60% 70%
Source: EIA
57% 18% 13%
Crude Oil Excise Taxes Transportation and Retailing Refining
12%
Source: EIA, based on average 2014 price of $3.83 per gallon
Combined local, state and federal (cents per gallon) as of January 1,2015
2013 2014 2015 Projected 2016 Projected
WTI Crudea ($/barrel)
97.91 93.26 55.02 71.00
Brent Crude ($/barrel)
108.64 99.02 57.56 75.00
Gasolineb ($/gallon)
3.51 3.36 2.33 2.73
Dieselc ($/gallon)
3.92 3.83 2.83 3.24
Heating Oil ($/gallon)
3.78 3.73 2.74 3.03
Natural Gasd ($/mcf)
10.30 10.91 10.28 10.56
Electricity (cents/kwh)
12.12 12.49 12.63 12.85
a West Texas Intermediate b Average regular pump price c On-highway retail d Residential average
Source: EIA, Short-term Energy Outlook, February 2015.
The Congressional Budget Office predicts the price
by up to 51 cents per gallon and gasoline by up to
26 cents per
gallon by 2017.
to $5.8 billion a year in lower fuel costs
U.S. economy in 2020
trade deficit by $22 billion in 2020
Source: ICF International and EnSys Energy,
Within 10 years Canada and U.S. can provide all our liquid fuel needs
U.S. Oil Production Oil from Canada Biofuels Oil from Rest of World Sources of liquid fuel supply in 10 years 53% 13% 10% 24% 72% 18% 10%
Sources: EIA; Wood Mackenzie
Source: Wood Mackenzie,” “U.S. Supply Forecasts and Potential Jobs and Economic Impacts,” September 7, 2011.
90% 86% 86% 85% 83% 72% 70% 65%
Lead to more jobs Help strengthen energy security Help stimulate economy Help lower energy costs Support O&NG development Support Keystone XL pipeline Support
development Increasing energy taxes may hurt consumers Harris is Poll ll Result sults s on Inc Increased sed U.S .S. . Oil il and N Natural l Gas s De Developm lopment
Source: Harris Interactive telephone poll, November 5, 2014