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963 views Jan 23, 2014 23 Comments
Posted on 01/24/2014 9:42:41 PM PST by ckilmer
Oil well (photo by John Hill)
With increasing energy efficiency in cars
, homes, and industry, plus a surge in domestic natural-gas production, U.S. demand for oil is widely said to have tapered off and in fact begun a structural decline.
Except that, as it turns out, last year it seems U.S. demand for oil actually rose by 390,000 barrels per day, according to the International Energy Agency.
That represented fully one-third of the total global increase in demand.
An article in today's Financial Times from London notes that global energy analysts have been startled by an apparent increase of 4 to 5 percent in U.S. oil consumption last year.
Gas pump
The weekly data, from the U.S. Energy Information, was dismissed at first. As more data has accrued, analysts are starting to conclude the U.S. will lead global oil demand--perhaps even exceeding the increase in demand from China for the first time since 1999.
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The causes are diverse. The market for full-size pickup trucks and sport-utility vehicles is surging, after several years of lower sales, and gasoline prices remain between $3 and $4 per gallon, the same range they've stayed in since roughly 2008.
While U.S. gasoline consumption peaked in 2006 and will decline going forward, it alone still accounts for almost 10 percent of global oil consumption.
U.S. industrial output and farm harvests have both increased, and increased production of shale oil from North American sources provides alternative feedstocks for chemical production.
The U.S. still exports oil products, but growth in those exports slowed markedly last year compared to 2012, as higher domestic consumption increased demand.
Meanwhile, the increase in oil demand in China was the lowest since 2005--and it is now a net exporter of both diesel fuel and gasoline.
The numbers remain somewhat in dispute, and analysts will continue to pore over reams of data and debate trends and causes.
But the overall message seems to be that global demand for oil will continue to rise as the economic recovery takes hold.
While the U.S. will soon have more than 200,000 plug-in electric zero-emission vehicles on its roads--out of a total pool of roughly 250 million vehicles--the new data offer a reminder that there's a very long way to go before demand for oil to fuel our vehicles declines more than incrementally.
And the same applies, even more so, to the more than 1 billion vehicles on the world's roads.
The last five years have been a bad time for “analysts” in all categories.
fun stuff.
Is there much liquid pete going into power gen?
I thought it was all nat gas due to emission regs.
We have the oil to meet this demand, so what’s the problem?
It would be nice to get out of this recession...
5.56mm
We have the oil to meet this demand, so what’s the problem?
..........
The question is which way are oil prices headed.
Lower oil prices will be great for the consumer but discourage more drilling—pushing away the chance for energy independence. Higher oil prices encourage more drilling but discourage consumers and choke off further economic expansion.
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