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Wednesday, March 16, 2005

Unravelling numbers

Today's Washington Post contains the following quote on the OPEC decisions, giving some indication of where the anticipated increase in oil is anticipated to come from.

Global crude consumption is expected to hit 86.1 million bpd during the seasonal demand peak of the fourth quarter, up from 83.7 million bpd on average for the first nine months of 2005, according to projections from the Paris-based International Energy Agency.

Naimi said Tuesday Riyadh had already raised production by 250,000 bpd in anticipation of the deal with more to come next month. Kuwait said it would add 120,000 bpd in April.

Adding 2 million bpd from Iraq, exempt from a quota, total OPEC supply will be above 30 million bpd and close to September's 25-year production high.

What is interesting, apart from the fact that World demand is now expected to grow by 2.4 mbd (higher than earlier estimates) is that, if Saudi Arabia, UAE and Kuwait have increased their overall production, and the rest are producing at their current maximum, then if the total is less than it was last September, then this recognizes that some of the other members of OPEC are seeing a decline in their overall production capabilities.

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