Oil Market Expected to Ease
IEA on June 17 released its Medium-Term Oil Market Report. Rystad Energy has compared the revised IEA demand outlook with own supply estimates deriving from its global upstream database UCube. The estimates are based on Rystad Energy’s bottom-up analysis of 30,000 fields and 2,500 oil companies in 150 countries.
Analysis shows that oil markets have gradually been tightening over the last two years while the outlook indicates a possible inflection point early 2015 and an increasing downward pressure on oil prices for the coming two-three years. The recent geopolitical outages of oil production from the Middle East and North Africa has until now been perfectly balanced by the increased supply of unconventional tight oil from the United States. This predicted easing of the oil markets is partly driven by an assumption of gradual return over the next two years of oil from Libya, Iran, Iraq and Sudan, while US drillers are continuing their activities with unchanged intensity and increased efficiency.
Rystad Energy now forecasts North American tight liquids production to pass 10 million barrels before 2020 making North America a net exporter of seaborne crude and petroleum products within three years from now.