IEA: NEGATIVE OIL PRICES
According to IEA, the current oil price environment has had a negative impact on oil investments, hurt energy efficiency and boosted the share of oil produced in the Middle East.
The latest data from the IEA showed that investments in the oil sector declined in 2015, and then again in 2016, the first consecutive two-year drop in three decades. The industry cut more than $300 billion in spending in two years, or 42 percent of the total, an unprecedented downturn, even taking into account significant reduction in costs. North America accounted for about half the drop. If prices remain at current levels, a significant rebound appears unlikely in 2017.
The latest data also points out that Middle East oil supply has reached historically high levels, exceeding 31 million barrels per day. The region now accounts for 35 percent of global oil supplies, the highest level since 1975. This growth in production, from Saudi Arabia, Iraq and Iran, highlights the fact that low-cost producers in the Middle East remain central to oil markets. Production from the Middle East is expected to account for most of the world's demand growth this year.
Lastly, the lower oil and gasoline prices are also hurting energy efficiency trends in some countries, particularly in the transportation sector where they have given a boost to the sale of sport utility vehicles. Consumers have moved away from energy-efficient vehicles that they favored when oil prices were higher. In the United States, SUV sales are now 2.5 times higher than light duty vehicles. In China, SUV sales are 4 times higher than light duty vehicle sales.
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AN - China National Offshore Oil Corp. (CNOOC) is willing to invest $3 billion in its existing oil and gas operation in Nigeria, the Nigerian National Petroleum Corporation (NNPC) said on Sunday following a meeting with the Chinese in Abuja.
REUTERS - Production at Libya’s giant Sharara oil field was expected to fall by at least 160,000 barrels per day (bpd) on Saturday after two staff were abducted in an attack by an unknown group, the National Oil Corporation (NOC) said.
IMF - Output grew by 3.8 percent in 2017, underpinned by a resilient non-hydrocarbon sector, with robust implementation of GCC-funded projects as well as strong activity in the financial, hospitality, and education sectors. The banking system remains stable with large capital buffers. Growth is projected to decelerate over the medium term.
IMF - Higher oil prices and short-term portfolio inflows have provided relief from external and fiscal pressures but the recovery remains challenging. Inflation declined to its lowest level in more than two years. Real GDP expanded by 2 percent in the first quarter of 2018 compared to the first quarter of last year. However, activity in the non-oil non-agricultural sector remains weak as lower purchasing power weighs on consumer demand and as credit risk continues to limit bank lending.