TALKING POINTS: SOME CURRENT OBSERVATIONS ABOUT WORLD OIL PRODUCTION

Talking Points:

TALKING POINTS: SOME CURRENT OBSERVATIONS ABOUT WORLD OIL PRODUCTION

Posted September 12, 2018

The following observations are from various sources. They are meant to stimulate thought. For exact sources and detailed analysis, please contact the author.

THE US IS AN INCREASINGLY IMPORTANT PRODUCER

1. The US is the world’s largest oil producer, exceeding Saudi Arabia.

2. The US produces roughly 2.5 times as much oil as Canada.

3. The US is increasing self-reliant on its own production – producing over ½ of its needs.

4. US imports of oil are diversified. Each country exporting to the US needs the US more than the US needs any one of them.

5. Imports from Canada are about 10% of US demand.

CANADA IS IMPORTANT BUT PERHAPS LESS SO THAN MANY PEOPLE THINK

1. Total Canadian proven reserves are about 170 billion barrels or about 10% of global reserves.

2. Canada’s oil production is only slightly more than China’s and is less than ½ of Russia’s.

3. Canada exports about 2/3 of its production – almost all to the US.

4. Canada needs the US market more than the US needs Canadian production.

5. The entirety of Canada’s proven reserves would satisfy US consumption for 23 years.

6. US consumption is 7.26 billion barrels per year. It has proven reserves of about 44 billion barrels.

THE GLOBAL MARKET MUST BE CONSIDERED

1. Russia produces more oil than Canada and is a net exporter of oil.

2. Russia’s major export markets are Europe and China.

3. China imports over 70% of its oil.

4. India has about 6 billion barrels of proven oil reserves and imports approximately 80% of its oil primarily from the Middle East.

5. India’s demand for oil is 6 million barrels per day (4 times Canadian consumption) and is increasing rapidly.

OIL IS IMPORTANT BUT …

1. Growth in global oil demand is slowing.

2. Proven oil reserves are increasing with new discoveries and recovery technologies.

3. “Peak Demand” for oil is likely to occur in 20-30 years.

4. At current consumption rates, the world has 53 years of oil remaining.

6. Increased energy efficiency and oil substitutes are contributing to a reduction in oil demand but economic growth is contributing to increased demand.

7. About 65% of oil is used for transportation.

8. Oil accounts for about 37% of total US energy consumption.

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