Between a rock and a hardplace
There is precious little sign of significant production falls anywhere. US and international rig counts continue to plunge. And there is little sign of global demand recovering as OECD economies buckle under the weight of misguided energy policy and debt. There is a risk of the plunge in oil price resuming.
ENERGY MATTERS
Oil Production Vital Statistics March 2016
Since the possible double bottom at $26 formed on February 11th the oil price has staged a rally to $40 (WTI). Traders lucky enough to buy at $26 and sell at $40 have pocketed a tidy 54% profit. Very few will have been this lucky. The trade was stimulated by news that Saudi Arabia and Russia had agreed to not increase production this year which is hollow news since neither country could significantly increase production no matter how hard they tried. Profit taking has now driven WTI back towards $37 as of 1 April.
What next? There is precious little sign of significant production falls anywhere. US and international rig counts continue to plunge. And there is little sign of global demand recovering as OECD economies buckle under the weight of misguided energy policy and debt. There is a risk of the plunge in oil price resuming.
The following totals compare Feb 2016 with Jan 2016:
- World Total Liquids down 180,000 bpd
- USA down 60,000 bpd
- North America down 100,000 bpd (includes USA)
- OPEC up 100,000 bpd
- Saudi Arabia up 20,000 bpd
- Iran up 220,000 bpd
- Russia + FSU down 10,000 bpd
- Europe up 220,000 bpd (YOY)
- Asia up 60,000 bpd
This article first appeared on Energy Matters.
EIA oil price and Baker Hughes rig count charts are updated to the end of March 2016, the remaining oil production charts are updated to February 2015 using the IEA OMR data.
