CRUDE OIL PRODUCTION AND PRICES: A LOOK AHEAD AT OPEC DECISION MAKING PROCESS

Richard C. Duncan, Ph.D. Presented at the PTTC Workshop "Fourth Annual Troubleshooters Forum" Petroleum Technology Transfer Council Bakersfield, California 22 September 2000

ABSTRACT

Basics: At end-1999 the OPEC nations owned 77.6% of the World's 'proved oil reserves', but had only 8.4% of the World's population. The non-OPEC nations vice versa. Forecasts: Oil production data from 1857 to 1999, reserve estimates, and other key information and a unique new oil forecasting method are used to predict the oil production from 2000 to 2040 for the World's top 44 oil-producing nations. These 44 forecasts are then summed, as needed, to predict the oil production from 2000 to 2040 for OPEC and non-OPEC, the Big Five and non-Big Five nations, and the World. World oil production is forecast to peak in 2006 and thereafter decline at about 2.5 %/year.

OPEC production exceeds non-OPEC production in 2008 (i.e. the "OPEC crossover event") and thereafter OPEC dominates both World oil production and exports. OPEC leadership concentrates in the Big Five nations of the Middle East Saudi Arabia, Iraq, United Arab Emirates, Kuwait and Iran. The Big Five nations' production exceeds non-Big Five nations' production in 2025 (i.e. the "Big Five crossover event") and thereafter the Big Five nations dominate World oil production and exports.

Saudi Arabia can obtain the maximum return on investment (ROI) and, moreover, they can achieve maximum long-term income security by NOT increasing their oil production. Several distinguished professionals forecast "a seller's market from now on with firm-to-higher prices for all the oil that can be produced." In contrast, however, a 'matrix-of-factors' scenario developed herein suggests otherwise.

Scenario: The Road Ahead leads directly to war in the Middle East in a matter of months, not years. The conflagration will spread worldwide. Oil prices will be highly volatile perhaps hitting $100 or more per barrel.

Institute on Energy and Man
5307 Ravenna Place NE, #1
Seattle, WA 98105
duncanrc@halcyon.com
http://www.halcyon.com/duncanrc/
END ABSTRACT

See a slightly-out-of-date paper of Richard's at
http://dieoff.com/page133.htm

OIL
At the Second Annual International Business Forum for the Asia Pacific and Indonesian Oil, Gas and Energy sectors, Secretary General of OPEC Rilwanu Lukman said that non-OPEC oil reserves could be depleted in less than 20 years! Moreover, Non-OPEC only holds some 23 percent of the world's proven crude oil reserves, yet account for 60 percent of global production.
( See L.B. Magoon's USGS poster is at http://www.hubbertpeak.com/magoon/ )

It seems that the present consensus of oil analysists is that oil stocks should rebuild (and oil prices should fall temporarly -- unless there is a war) by the second quarter of 2001. http://www.mees.com/news/a43n38a01.htm

CANADA SCREWED
Canada gave up all rights to her oil and gas when she signed NAFTA! This means that Canada will be frozen solid in less than a decade (frozen pipes bursting on the second floor) while American millionaires (and billionaires) play golf in air-conditioned deserts. See
globeandmail.com/gam/Commentary/20000926/COBARLOW.html

Here is a message from the runningonempty mailing list owner, Bruce Thompson:
It's real. It's coming. Millions of Americans and Canadians shocked, out of work, hopeless and depressed. Thousands freezing to death in gloomy homes, thousands dying in unrelieved city heat. Unlit, dangerous streets. Boarded up shops. Beggars, bodies. White Calcutta everywhere. Day and night terror of murder, home invasions, organized criminals, protection rackets. Martial law: Fake media, casual speech dangerous, authoritarian torture, murder of family/friends. All today's elegant shops neglected, dim, shabby caves, bare of goods, sparse people. Queues. Squalid parks full of hopeless, dirty, sick, bored people, including people we know, and maybe us.Crammed hospitals with no resources. Unrelieved sickness, infections, excruciating pain. Stinking air pollution as the public burns even park trees, fences, benches, used oil, for warmth. Destruction of forests, bushes, anything burnable. Same for wildlife, anything edible. Dilapidated buildings, roads. It's real. It's coming. Let's make our lives meaningful by fighting it with everything we've got, to at least delay it. Bruce Thomson, bruce@sympatico.ca
If you want to help me, join my mailing list be sending a message to
RunningOnEmpty-subscribe@egroups.com

Jay Hanson

Whatta Hero!

Mizaru, kikazaru, iwazaru.