Official (Alberta) Oil Discussion Thread

[Frequitude]

Originally Posted by Nufy

Anyone wanna bet that Calgary gas marketers try to raise the pump price because of this...

I'm pretty sure they'd be justified in doing so...

[Tinordi]

Remember when I was lambasted pages back for saying that oil demand will probably peak by 2030? According the Shell the peak could happen in 5 years:

https://www.bloomberg.com/news/artic...eak-in-5-years

Other news of interest, Exxon "debooked" (wrote down) 19% of global oil reserves last week. The largest share of the write down was from the oil sands.

http://www.bloomberg.com/news/articl...-extends-slump

Not to portend doom, but I think is quite likely that the growth phase of oil sands production is permanently over.

[belsarius]

Originally Posted by Tinordi

Remember when I was lambasted pages back for saying that oil demand will probably peak by 2030? According the Shell the peak could happen in 5 years:

https://www.bloomberg.com/news/artic...eak-in-5-years

Other news of interest, Exxon "debooked" (wrote down) 19% of global oil reserves last week. The largest share of the write down was from the oil sands.

http://www.bloomberg.com/news/articl...-extends-slump

Not to portend doom, but I think is quite likely that the growth phase of oil sands production is permanently over.

I could see that 2030. China is focused on peaking it's carbon emissions by 2030 and have been moving to renewables. I think Hydrogen fuel is almost to the point where is can start to take over mass vehicle propulsion, there are lots of pilot projects in Europe and now China is using Canadian Hydrogen technology in their busses.

There will still be need for oil for a while to come, but I think you are right the growth phase we saw for the last decade may be over but I don't think there will be a decline in production for many years still.

[OMG!WTF!]

Must have been a bad inventory number today. Big drop at 8:30.

[IliketoPuck]

I think it is more driven by bearish sentiment to the possibility of an OPEC cut. Regardless, it is all near term market churn and arm waving.

It doesn't change the fundamentals of long term supply / demand.

Global demand grows at 1.2MMbl/d/year.

Global supplies decline by ~5%/year (~4-5MMbbl/d).

The capex required to replace those declines, and to grow production to keep up with increasing demand, is not being deployed.

The building blocks for a nice bull market are in place.

[Leeman4Gilmour]

Originally Posted by Tinordi

Remember when I was lambasted pages back for saying that oil demand will probably peak by 2030? According the Shell the peak could happen in 5 years:

https://www.bloomberg.com/news/artic...eak-in-5-years

Other news of interest, Exxon "debooked" (wrote down) 19% of global oil reserves last week. The largest share of the write down was from the oil sands.

http://www.bloomberg.com/news/articl...-extends-slump

Not to portend doom, but I think is quite likely that the growth phase of oil sands production is permanently over.

Just to clarify;

From the Exxon article;

About 3.6 billion barrels of reserves in the Canadian oil sands and the equivalent of another 1 billion barrels of oil in other North American fields may be in jeopardy if the average energy prices seen during the first nine months of 2016 persist

From the Shell;

And that peak may be somewhere between 5 and 15 years

But, still, a sign that the transition to a cleaner energy sources is continuing.

[IliketoPuck]

Originally Posted by Leeman4Gilmour

Just to clarify;

From the Exxon article;



From the Shell;



But, still, a sign that the transition to a cleaner energy sources is continuing.

People have been predicting "peak oil" for a long time, and demand keeps growing at 1.2MMbbl/d/y.

I'm curious how ongoing industrialization and modernization in China and India will effect oil demand. Personally, I don't see those economies satisfying their massive needs for energy with solar panels, but that's just me.

As for Exxon's reserves. The company reports under U.S. GAAP, which requires it to permanently write down reserves if they are deemed economically unrecoverable at current prices. It is an accounting necessity. It doesn't mean that Exxon is abandoning the oil sands, or that the peak oil oogabooga monster is hiding under your bed.

[belsarius]

Originally Posted by IliketoPuck

People have been predicting "peak oil" for a long time, and demand keeps growing at 1.2MMbbl/d/y.

I'm curious how ongoing industrialization and modernization in China and India will effect oil demand. Personally, I don't see those economies satisfying their massive needs for energy with solar panels, but that's just me.

As for Exxon's reserves. The company reports under U.S. GAAP, which requires it to permanently write down reserves if they are deemed economically unrecoverable at current prices. It is an accounting necessity. It doesn't mean that Exxon is abandoning the oil sands, or that the peak oil oogabooga monster is hiding under your bed.

Actually..

A study by the environmental group Greenpeace found that last year, all of China's additional energy needs were met by green energy, as its growth outstrips the use of coal and oil. In fact, the level of coal-generated electricity has declined for three years in a row.

http://www.cbc.ca/news/world/china-p...823786?cmp=rss

[IliketoPuck]

"A study by the environmental group Greenpeace"

My apologies, I was wrong. No biases to see here.

Glad to see China and India no longer need oil.

[belsarius]

Originally Posted by IliketoPuck

"A study by the environmental group Greenpeace"

My apologies, I was wrong. No biases to see here.

Glad to see China and India no longer need oil.

So you think Greenpeace would bias the report to show China being more green than it is? Do you know what Greenpeace is? If anything Greenpeace is going to be harder on them and more inclined to find flaws in their renewable data.

And no one is saying they no longer need oil. It is saying they're growth needs are being met with renewables but there is a heck of a lot old energy needs that are still using coal and oil on huge scales. They don't even see a peak of their emissions until 2030 and will need oil and coal for many years past that. The point is they are adapting, they are changing their energy use to renewables, and are making progress.

Short term they will probably still show increases in oil demand, but if you are planning on projects that won't start paying off until after 2030, which most new oil sands projects won't, then you have to take into consideration this change in China's energy needs is going to affect profitability in the longer term.

[Locke]

Originally Posted by IliketoPuck

"A study by the environmental group Greenpeace"

My apologies, I was wrong. No biases to see here.

Glad to see China and India no longer need oil.

Well. That solves that problem. That whole 'Global Warming due to massive emissions' hullaballoo ought to just take care of itself now.

I like when these kinds of problems solve themselves.

Now I cab burn a barrel of diesel in my backyard and feel good about myself at the same time!

[IliketoPuck]

The results of the report are just the results of the inquiry used to obtain the information. Completely plausible that the report itself is not biased based on the information obtained.

How that information was obtained, and through which methods is where the bias is introduced. I would love to hear the argument that Greenpeace is an unbiased research organization.

China will show substantial demand for oil and gas for decades. And we haven't even mentioned India, Africa, or a whole host of other developing economies that will require sources of cheap energy to continue moving towards first world economies.

[IliketoPuck]

Originally Posted by Locke

Well. That solves that problem. That whole 'Global Warming due to massive emissions' hullaballoo ought to just take care of itself now.

I like when these kinds of problems solve themselves.

Now I cab burn a barrel of diesel in my backyard and feel good about myself at the same time!

I'll bring the spolumbos.

We could kick it up a notch and burn some refinery coke to really get the party going.

[Tinordi]

China also has the second largest EV market in the world and sales of EVs are surging. Interestingly, China's EV market is made up almost entirely of Chinese vehicle manufacturers (BYD) - 96% of EV sales are from Chinese companies. China has an estimated 200 million e-bikes and 200 thousand electric buses.

To just flippantly say that demand for oil will just continue unabated in China is, frankly, not very tuned into what appears to be happening on the ground. So yes, the market is still very small but that may be the key indicator for big future change.

[Locke]

Originally Posted by IliketoPuck

I'll bring the spolumbos.

We could kick it up a notch and burn some refinery coke to really get the party going.

That'll help dispose of all of this industrial garbage and bags of leaves I've got.

Its really nice to know that Global Warming is no longer a problem due to declining Oil demand. Its like a huge weight off my shoulders.

[Flash Walken]

Originally Posted by Locke

Well. That solves that problem. That whole 'Global Warming due to massive emissions' hullaballoo ought to just take care of itself now.

I like when these kinds of problems solve themselves.

Now I cab burn a barrel of diesel in my backyard and feel good about myself at the same time!

[Shazam]

Originally Posted by Tinordi

China also has the second largest EV market in the world and sales of EVs are surging. Interestingly, China's EV market is made up almost entirely of Chinese vehicle manufacturers (BYD) - 96% of EV sales are from Chinese companies. China has an estimated 200 million e-bikes and 200 thousand electric buses.

To just flippantly say that demand for oil will just continue unabated in China is, frankly, not very tuned into what appears to be happening on the ground. So yes, the market is still very small but that may be the key indicator for big future change.

China's #1 in all sorts of things!

#1 in solar power generation!
#1 in wind power generation!
#1 in hydro power generation!

#1 in coal power generation!

[IliketoPuck]

Tinordi. Forest through the trees.

It blows my mind that when oil demand is mentioned, immediately people point to electric vehicles as the source of the end of oil.

Oil demand connected to consumer vehicle usage (small cars, suv, etc.) is only 20% of total demand. Even if literally every single car on the road was replaced with an EV, over 80% of demand for oil would remain. Not to mention, those batteries have to be charged by some form of energy. I'm guessing most people aren't going to have solar panels or wind turbines on their roof. So, fossil fuels then.

Will EV usage increase? Of course. I'm not so naive as to think otherwise.

But to just point to EVs as the source of the demise of oil is disingenuous, and does not paint the whole picture. The same thing goes for pointing to solar panels, or wind, or any other renewable energy source. There are meaningful limiting factors to all of those energy sources that always conveniently get glossed over in the frenzy to be environmental boy scouts.

[Tinordi]

Read my posts. I'm talking about growth. And it's not just me, the oil majors are too. And they're saying that the growth outlook is weakening.

The rest of your ranting has been noted.

[nfotiu]

Originally Posted by IliketoPuck

Tinordi. Forest through the trees.

It blows my mind that when oil demand is mentioned, immediately people point to electric vehicles as the source of the end of oil.

Oil demand connected to vehicle usage is only 20% of total demand. Even if literally every single car on the road was replaced with an EV, over 80% of demand for oil would remain. Not to mention, those batteries have to be charged by some form of energy. I'm guessing most people aren't going to have solar panels or wind turbines on their roof. So, fossil fuels then.

Will EV usage increase? Of course. I'm not so naive as to think otherwise.

But to just point to EVs as the source of the demise of oil is disingenuous, and does not paint the whole picture. The same thing goes for pointing to solar panels, or wind, or any other renewable energy source. There are meaningful limiting factors to all of those energy sources that always conveniently get glossed over in the frenzy to be environmental boy scouts.

Do you have any sources to back up that 20% claim. I think you are confusing percentage of energy used and percentage of oil used. Over 70% of US oil is used for transportation, and 65% of that is used by cars.

Personally, I think the improvement of vehicle fuel efficiency over the last decade or so will have a more immediate effect on oil demand as more new cars replace less efficient ones. EVs will eventually continue that trend.