by Jerome a Paris
Tue Nov 22nd, 2005 at 03:51:16 AM EST
Bumped & updated by DoDo
The big energy news of last weekend was the start of the Joint Oil Data Initiative (Jodi), which for the first time promises real data on production levels in OPEC countries too (see Jérôme's original post below the fold).
Now the database is on-line, the presently available data (including OPEC) can be accessed here. For comparison, you can check one set of previous production estimates (these by MEES) here.
The data is colour-coded: most reliable (checked) data is blue. Individual countries' cooperation is rated (rating explained).
So far, my bet on 100$ oil by the end of this year is not looking so smart, but have no fear, I'll stay the course. And this week-end, some arguments may actually be provided in my favor:
Opec set to lift secrecy about oil production
The Organisation of the Petroleum Exporting Countries, the cartel that controls 40 per cent of world oil exports, will on Saturday lift a four-decade veil of secrecy and begin regularly to reveal how much oil it is actually pumping.
China and India, the fastest growing major oil consumers, will also supply consumption and storage data for the first time.
The Joint Oil Data Initiative (Jodi), which will be launched on Saturday in Riyadh by energy and finance ministers of the biggest oil producing and consuming countries, will meet a persistent demand of the Group of seven industrialised countries for more transparent energy data.
The price rise of the past three years, which this year saw oil hit nominal highs of $70.85 a barrel, could in part have been avoided by better data, analysts said. It would provide a more accurate basis for industry investment decisions, which in turn help determine long term supplies.
But analysts also suggested that the new database was unlikely to transform the currently unscientific art of guessing world demand and supply into a simple task.
One person close to Saturday's event said that the data would reveal little difference to existing output estimates for some countries including Saudi Arabia, the world's biggest oil producer but would show a five to 10 per cent disparity in the production levels of other Opec countries.
Traders said they would have to wait until the numbers came out to know whether they would move the oil price when markets reopen on Monday.
JODI has its own website, which has not gone live (it exists, but provides no data yet), and says it will provide the following data:
- Seven products : Crude Oil, LPG, Gasoline, Kerosene, Diesel Oil, Fuel Oil and Total Oil,
- Four flows : Production, Demand, Closing Stock Levels and Changes.
- Data are available in three different units : barrels, tons and litres
- For 92 participating countries
- Monthly data from January 2002 to one month old.
Any transparent data is a good thing, and this seems to be a genuine progress for the markets to understand what's going on. However, as this post over at the Oil Drum notes, it provides no new information about reserves and production rates for individual fields, the two most important determinants to know what's actually going on on the supply side. The Oil Drum also notes that this will not help us know more about depletion rates (i.e. how fast fields are used up and go into decline) nor the situation on the drilling rigs side
If fields require increasing numbers of rigs to produce, it is a sign that production is becoming more difficult - and costly - and it creates other tensions on the rig market, a market that has just been violently disturbed (30kb pdf) by the hurricanes in the Gulf of Mexico:
So where does that leave us? Here's a mainstream opinion (MarketWatch - use id: firstname.lastname@example.org psw: dialykos to register):
Are we there yet? Prospect of $100 oil - Longer-term bets based on high risk, depleting sources
"What ever happened to $100 crude? It just got postponed," said Agbeli Ameko, a managing partner at First Enercast Financial. "That is, at least until the next hurricane season or some geopolitical bombshell."
"In this 'peak-oil' and 'terror-premium' environment, the market will remain in reach of the $100 barrier," he said.
"I don't think we're going to have enough alternative energies at a good price that's globally distributed within the next two to five years before [the] next global expansion occurs," said Hassey.
There is "no really new alternative is on the horizon," said veteran commodities trader Kevin Kerr.
Given all that, "$100 oil is not that far off" -- in 2 to 30 months without a major terrorist act, and 6 to 12 months with a major terrorist attack, said Kerr, who also edits Global Resources Trader, a service of MarketWatch.
"The bottom line is, the light, sweet, easy-to-get/easy-to-refine oil is much harder to lay your hands on nowadays," he said, and that lack of light, sweet crude to refine "will most certainly drive prices higher overall."
So "for those asking 'are we there yet?' -- be patient. It probably won't happen in 2005, but 2006 or 2007 could be another story," First Enercast's Ameko said.
So, let's see if this week-end's data brings any reason to change that estimate (for instance if it appears that Saudi production is no higher than last winter). In any case, even if I lose this year-end bet, I'll continue the series. We're still going there - pretty soon.
Are you getting ready in the meantime? Any extra months we are granted before 100$ oil or more happens should be used to make it easier to live with it when it happens, because it will.
Earlier "Countdown" diaries:
Countdown to 100$ oil (15) - the impact on your electricity bill
Countdown to 100$ oil (14) - Greenspan acknoweldges peak oil
Countdown to 100$ oil (13) - Katrina strikes / refinery crisis
Countdown to 100$ oil (12) - Al-Qaeda, oil and Asian financial centers
Countdown to 100$ oil (11) - it's Greenspan's fault!
Countdown to 100$ oil (10) - Simmons says 300$ soon - and more
Countdown to 100$ oil (9) - I am taking bets
Countdown to 100$ oil (8) - just raw data
Countdown to 100$ oil (7) - a smart solution: the bike
Countdown to 100$ oil (6) - and the loser is ... Africa
Countdown to 100$ oil (5) - OPEC inexorably raises floor price
Countdown to 100$ oil (4) - WSJ wingnuts vs China
Countdown to 100$ oil (3) - industry is beginning to suffer
Countdown to 100$ oil (2) - the views of the elites on peak oil
Countdown to 100$ oil (1)