International energy markets. For. Cheung Kong Graduate School of Business.
July 29, 2015 | Beijing, China by. Adam Sieminski, Administrator. U.S. Energy ...
International energy markets
For Cheung Kong Graduate School of Business July 29, 2015 | Beijing, China by Adam Sieminski, Administrator U.S. Energy Information Administration
U.S. Energy Information Administration
Independent Statistics & Analysis
www.eia.gov
Mandate: EIA collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment Independence: EIA, an element of the Department of Energy, is one of 14 federal statistical agencies; by law, its data, analyses, and forecasts are independent of approval by any other officer or employee of the United States Government Mission: EIA provides data and analysis to help stakeholders understand the rapidly changing energy sector in areas such as: •
Oil and gas production
•
Changing energy trade flows
•
Oil price volatility and projections
•
Vehicle, building, and manufacturing consumption trends
•
Distributed renewables generation
•
Coal and nuclear power outlooks International energy markets July 29, 2015
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EIA principles • Provide relevant energy statistics and analysis as a public good
• Be accurate and objective • Protect the confidentiality of respondents
• Maintain the public trust
International energy markets July 29, 2015
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EIA information is used by a range of stakeholders Examples of Activities
EIA Customers
Media Government 9% 2%
Business/ Industry 22%
Education 12%
Energy Sector 21%
Private Citizen 16% Finance/ Consulting 18%
Source: 2014 EIA Web Customer Survey
Government • Executive Agencies – WH, DOE, & EPA use EIA data to track energy markets and program performance and to analyze policy proposals • Congress – policy development and agency funding • State Governments – planning and program development Energy Sector • Consumers – monitor price forecasts • Producers – track inventory statistics Business/Industry • Manufacturers – market research Finance/Consulting • Commodities Analysts – market response to supply data Media/Education • Journalists – cite energy statistics • Teachers – use Energy Kids materials • Researchers – energy forecasting and modeling Private Citizens • Public – research gasoline prices
Customer-focused Performance Results • Quality: 95% of customers are satisfied or very satisfied with the quality of EIA information • Timeliness: 96% of selected EIA recurring products meet their release date target International energy markets July 29, 2015
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The importance of China in the global energy markets
International energy markets July 29, 2015
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By 2040, China’s energy use will be double the U.S. level; India’s a little more than half despite its faster GDP growth energy consumption by selected country quadrillion Btu History 2010 250
Projections
200 China 150 United States 100 India 50
0 1990
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
Source: EIA, International Energy Outlook 2013 International energy markets July 29, 2015
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Net oil imports: Trends in the largest consuming countries million barrels per day (MMb/d) 10 History
Forecast
9 8 7 6 5 4 3 China net imports
2
U.S. net imports
1 0 2011
2012
2013
2014
2015
2016
Source: EIA, Short-Term Energy Outlook, July 2015 International energy markets July 29, 2015
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Current oil and gas markets
International energy markets July 29, 2015
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For oil prices, the market-implied confidence band is very wide WTI price dollars per barrel 150 125 100
75 50
Historical Spot Price STEO Forecast NYMEX Futures Price
25 0
Current 95% NYMEX futures price confidence interval June 2014 95% NYMEX futures price confidence interval Jan Apr
Jul Oct Jan Apr Jul Oct Jan Apr Jul 2013 2014 2015
Oct Jan Apr
Jul 2016
Oct
Source: EIA, Short-Term Energy Outlook, July 2015 International energy markets July 29, 2015
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The U.S. has experienced a rapid increase in natural gas and oil production from shale and other tight resources
Eagle Ford (TX)
U.S. tight oil production million barrels of oil per day 5.0
U.S. dry shale gas production billion cubic feet per day 45 Marcellus (PA & WV)
Bakken (MT & ND) Spraberry (TX & NM Permian) Bonespring (TX & NM Permian)
Wolfcamp (TX & NM Permian) Delaware (TX & NM Permian) Yeso-Glorieta (TX & NM Permian) Niobrara-Codell (CO, WY)
4.5
4.0 3.5
Eagle Ford (TX) Fayetteville (AR)
Granite Wash (OK & TX) Austin Chalk (LA & TX) Monterey (CA)
35 30
3.0
Woodford (OK)
25
2.5
Bakken (ND)
2.0
Antrim (MI, IN, & OH)
1.5
Utica (OH, PA & WV)
15
Rest of US 'shale'
10
Marcellus
Woodford (OK)
40
Barnett (TX)
Haynesville Utica (OH, PA & WV)
Haynesville (LA & TX)
1.0
20
0.5
5
0.0
0
Sources: EIA derived from state administrative data collected by DrillingInfo Inc. Data are through May 2015 and represent EIA’s official tight oil & shale gas estimates, but are not survey data. State abbreviations indicate primary state(s). International energy markets July 29, 2015
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Production growth in top crude producing regions (Permian, Bakken, Niobrara, and Eagle Ford) reverses in early 2015 monthly percent change three month rolling average 4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
-2.0% Jan 2012
Jan 2013
Jan 2014
Jan 2015
Source: EIA, Drilling Productivity Report, July 2015 International energy markets July 29, 2015
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Oil supply and demand begin to rebalance in 2016 million barrels per day (MMb/d)
MMb/d
98
6 Implied stock change and balance (right axis)
96
World production (left axis)
94
World consumption (left axis)
5 4
92
3
90 2 88 1 86 0
84 82
-1
80
-2
78 2010-Q1
-3 2011-Q1
2012-Q1
2013-Q1
2014-Q1
2015-Q1
2016-Q1
Source: EIA, Short-Term Energy Outlook, July 2015 International energy markets July 29, 2015
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Surprises in liquid fuel demand to the upside are rare world liquid fuels consumption million barrels per day (MMb/d) 96 94 92
annual change million barrels per day 8
Change in U.S. consumption (right axis)
Forecast
Change in China consumption (right axis)
7
Change in other consumption (right axis)
6
Total world consumption (left axis)
90
5
88
4
86
3
84
2
82
1
80
0
78
-1
76
-2
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: EIA, Short-Term Energy Outlook, July 2015 International energy markets July 29, 2015
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OPEC surplus crude oil production capacity remains moderate to low million barrels per day (MMb/d) 6 Forecast 5
Note: Shaded area represents 2004-2014 average (2.2 MMb/d)
4
3
2
1
0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: EIA, Short-Term Energy Outlook, July 2015 International energy markets July 29, 2015
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OECD commercial petroleum stocks remain high days of supply 70 Forecast 65
Note: Shaded area represents the range between the minimum and maximum from Jan 2010 to Dec 2014
60
55
50
45 Jan 2010
Jan 2011
Jan 2012
Jan 2013
Jan 2014
Jan 2015
Jan 2016
Source: EIA, Short-Term Energy Outlook, July 2015 International energy markets July 29, 2015
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Long-term U.S. energy projections
International energy markets July 29, 2015
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Reductions in energy intensity largely offset impact of GDP growth, leading to slow projected growth in energy use U.S. primary energy consumption quadrillion Btu History
Projections 2025
2013
120
2040
Renewables (excluding liquid biofuels) 100
80
Coal 40
Nuclear Liquid biofuels
0 1980
27% 8%
9%
10%
18%
19%
18%
8%
8%
8%
Natural gas
60
20
29%
27%
1990
1995
2000
2005
2010
1%
35%
36%
Petroleum and other liquids
1985
1%
1%
2015
2020
2025
33%
2030
2035
2040
Source: EIA, Annual Energy Outlook 2015, Reference case International energy markets July 29, 2015
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U.S. crude oil production: Supply rises above previous historical highs before 2020 in all AEO2015 cases, with a range of longer-term outcomes dependent on prices, resources and technology U.S. crude oil production million barrels per day (MMb/d) 2013 History 20
2013
2013
High Oil and Gas Resource
Reference
Low Oil Price
15 U.S. maximum production level of 9.6 million barrels per day in 1970 10 Tight oil 5 Lower 48 offshore
Other lower 48 onshore Alaska 0 1990 2000
2010
2020
2030
2040
2020
2030
2040
2020
2030
2040
Source: EIA, Annual Energy Outlook 2015 International energy markets July 29, 2015
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U.S. natural gas trade: Projected U.S. natural gas trade reflects the spread between domestic natural gas prices and world energy prices, along with resource outcomes U.S. natural gas imports and exports trillion cubic feet 16
billion cubic feet per day
History 2013
2013
Projections
2013
40
Lower 48 states LNG exports
12
Alaska LNG exports
30 20
8 Pipeline exports to Mexico
4
10 0
0 Pipeline exports to Canada
-4 LNG imports
-8 2000
2010
High Oil and Gas Resource
Reference 2020
2030
2040
-10
Pipeline imports from Canada
2020
2030
2040
Low Oil Price 2020
2030
-20 2040
Source: EIA, Annual Energy Outlook 2015 International energy markets July 29, 2015
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U.S. energy trade • Net exporter of petroleum products since 2010
• Crude oil export policy debate underway • Net exporter of natural gas by 2017
• Net exports of coal are small and steady • Net imports of electricity are small
Source: EIA, Annual Energy Outlook 2015, Reference case International energy markets July 29, 2015
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Long-term international outlook
International energy markets July 29, 2015
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Renewable energy and nuclear power are the fastest growing source of energy consumption world energy consumption by fuel quadrillion Btu History 2010 250
Projections 28% 27%
200 liquids (including biofuels)
23%
coal
34%
share of world total
28%
150
natural gas 15% 100
22%
renewables (excluding biofuels) 7%
11% 50 nuclear 5% 0 1990
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
Source: EIA, International Energy Outlook 2013
International energy markets July 29, 2015
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Non-OPEC petroleum and other liquids production million barrels per day (MMb/d) 70
60
rest of non-OECD
50 Brazil 40
China
30
Russia rest of OECD
20
Canada 10 United States 0 2010
2015
2020
2025
2030
2035
2040
Source: EIA, International Energy Outlook 2013, Reference case International energy markets July 29, 2015
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World natural gas production trillion cubic feet 200 180 rest of non-OECD
160 140
China
120
MENA
100 Russia
80 60 40
rest of OECD Canada
20
United States
0 2010
2015
2020
2025
2030
2035
2040
Note: The MENA region consists of the Middle East and North Africa countries Source: EIA, International Energy Outlook 2013, Reference case International energy markets July 29, 2015
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World coal production billion short tons
14 12
world total
10 other non-OECD Asia Australia India United States
8 6 4
China 2 0 2010
2015
2020
2025
2030
2035
2040
Note: Indonesia accounted for 72 percent of the total coal production in Other non-OECD Asia in 2010, rising from 52 percent in 2000. Throughout the projection period, Indonesia continues dominating the region's coal production. Source: EIA, International Energy Outlook 2013, Reference case International energy markets July 29, 2015
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World net hydropower and other renewable electricity generation trillion killowatthours 12
10
rest of non-OECD
8
India Brazil 6 China 4 rest of OECD
2 Canada United States
0 2010
2015
2020
2025
2030
2035
2040
Source: EIA, International Energy Outlook 2013, Reference case International energy markets July 29, 2015
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World net nuclear electricity generation trillion killowatthours 6
5
China
4
rest of world
3
India Russia OECD Europe
2 other Asia Japan United States
1
0 2010
2015
2020
2025
2030
2035
2040
Source: EIA, International Energy Outlook 2013, Reference case International energy markets July 29, 2015
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For more information U.S. Energy Information Administration home page | www.eia.gov Annual Energy Outlook | www.eia.gov/aeo Short-Term Energy Outlook | www.eia.gov/steo International Energy Outlook | www.eia.gov/ieo
Monthly Energy Review | www.eia.gov/mer Today in Energy | www.eia.gov/todayinenergy
State Energy Profiles | www.eia.gov/state Drilling Productivity Report | www.eia.gov/petroleum/drilling/ International Energy Portal | www.eia.gov/beta/international/?src=home-b1 International energy markets July 29, 2015
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