The Impact of Shale Oil Production Growth in the US

Transcription

1 The Impact of Shale Oil Production Growth in the US Presentation to IMSF, Copenhagen By Selena Yan, Senior Analyst

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3 What is Shale Oil Shale oil (Light Tight Oil) refers to light crude oil produced from shale, or other very low-permeability rocks, by using the same horizontal drilling and hydraulic fracturing technologies used in production of shale gas. Oil shale is a fine-grained sedimentary rock containing a waxy organic known as Kerogen. Shale oil and oil shale differs by the API gravity and viscosity of the fluids, as well as the method of extraction. Oil Shale 3

4 Hydraulic Fracturing & Horizontal Drilling Greater length of producing formation exposed to the wellbore in a horizontal well A than in a vertical well B Source: EIA 4

5 Source: EIA Includes both gas and oil plays 5

6 US Crude Oil Production Million bpd Jan-2 Oct-2 28: 17kbpd 213: 858kbpd Jul-21 Apr-22 Jan-23 Oct-23 Data Source: EIA North Dakoda Jul-24 Apr-25 Jan-26 Oct-26 Jul-27 Apr-28 Jan-29 Oct-29 Jul-21 Apr-211 Jan-212 Oct-212 Jul-213 Million bpd Jan-2 28: 1.1mbpd 213: 2.56mbpd Oct-2 Jul-21 Apr-22 Jan-23 Oct-23 Jul-24 Apr-25 Jan-26 Texas Oct-26 Jul-27 Apr-28 Jan-29 Oct-29 Jul-21 Apr-211 Jan-212 Oct-212 Jul

7 US Crude Oil Production Annual Averages 1 EIA ESTIMATES Million bpd Data source: EIA. Updated May

8 North American Oil Market U.S. & Canadian Supply, Demand and Refining Capacity 25 Demand Refinery Capacity Supply 2 Million bpd Data source: EIA & BP Stats U.S. and Canadian Supply includes shale oil, oil from oil sands and NGLs, excludes biofuels 8

9 Oil Supply Growth* North America 143 North America 137 Europe -19 Europe -1 FSU & Eastern Europe 11 FSU & Eastern Europe 2 Asia & Oceania -8 Asia & Oceania 9 Latin America 8 Latin America -1 Africa 9 Africa -4 OPEC -87 kbpd OPEC -38 kbpd Updated to May 214 * Shaded Areas are Non-OPEC only Data source: EIA

10 Million bpd US Crude Oil Imports Q1 25-Q3 Middle East Africa Europe Latin America Canada RoW 26-Q1 26-Q3 27-Q1 27-Q3 28-Q1 28-Q3 29-Q1 29-Q3 21-Q1 21-Q3 211-Q1 211-Q3 212-Q1 212-Q3 213-Q1 213-Q3 Million bpd US Crude Seaborne Imports by Type Heavy Medium Light Jan-8 Apr-8 Jul-8 Oct-8 Jan-9 Apr-9 Jul-9 Oct-9 Jan-1 Apr-1 Jul-1 Oct-1 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Data Source: EIA 1

11 US Crude Spot Market Imports 2 Aframax Suezmax VLCC Million tonnes Data source: Clarksons 11

12 Changing Crude and Fuel Oil Trade Patterns Million tonnes Aframax Suezmax VLCC Crude / DPP Spot fixture volumes West to East 4 2 Jan- Jun- Nov- Apr-1 Sep-1 Feb-2 Jul-2 Dec-2 May-3 Oct-3 Mar-4 Aug-4 Jan-5 Jun-5 Nov-5 Apr-6 Sep-6 Feb-7 Jul-7 Dec-7 May-8 Oct-8 Mar-9 Aug-9 Jan-1 Jun-1 Nov-1 Apr-11 Sep-11 Feb-12 Jul-12 Dec-12 May-13 Oct-13 Mar-14 Surplus Atlantic Basin crude and fuel oil moving to Asia Data source: Clarksons 12

13 Crude Prices 13 WTI LLS Bakken Dated Brent Jan-13 Feb-13 Mar-13 US$/barrel Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Data Source: Reuters 13

14 US Refinery Utilisation US East Coast US Gulf Million bpd Operable Crude Oil Distillation Capacity Percent Utilization of Refinery Operable Capacity % utilisation Million bpd Operable Crude Oil Distillation Capacity Percent Utilization of Refinery Operable Capacity % utilisation. Jan-27 Jul-27 Jan-28 Jul-28 Jan-29 Jul-29 Jan-21 Jul-21 Jan-211 Jul-211 Jan-212 Jul-212 Jan-213 Jul-213 Jan Jan-27 Jul-27 Jan-28 Jul-28 Jan-29 Jul-29 Jan-21 Jul-21 Jan-211 Jul-211 Jan-212 Jul-212 Jan-213 Jul-213 Jan Data source: EIA 14

15 US Petroleum Products Trade Imports Exports Gasoline Kerosene Distillate Fuel Oil Ethanol Production Gasoline Kerosene Distillate Fuel Oil Million bpd Million bpd Q1 2-Q4 21-Q3 22-Q2 23-Q1 23-Q4 24-Q3 25-Q2 26-Q1 26-Q4 27-Q3 28-Q2 29-Q1 29-Q4 21-Q3 211-Q2 212-Q1 212-Q4 213-Q3. 2-Q1 2-Q4 21-Q3 22-Q2 23-Q1 23-Q4 24-Q3 25-Q2 26-Q1 26-Q4 27-Q3 28-Q2 29-Q1 29-Q4 21-Q3 211-Q2 212-Q1 212-Q4 213-Q3 Data Source: EIA 15

16 US Gasoline Exports by Regions 7 Canada Mexico Latin America Europe Africa FSU Middle East Far East Oceania 6 5 Thousand bpd Jan- May- Sep- Jan-1 May-1 Sep-1 Jan-2 May-2 Sep-2 Jan-3 May-3 Sep-3 Jan-4 May-4 Sep-4 Jan-5 May-5 Sep-5 Jan-6 May-6 Sep-6 Jan-7 May-7 Sep-7 Jan-8 May-8 Sep-8 Jan-9 May-9 Sep-9 Jan-1 May-1 Sep-1 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 Data Source: EIA 16

17 US Distillate Fuel Oil Exports by Regions 1,4 Canada Mexico Latin America Europe Africa FSU Middle East Far East Oceania 1,2 1, Thousand bpd Jan- May- Sep- Jan-1 May-1 Sep-1 Jan-2 May-2 Sep-2 Jan-3 May-3 Sep-3 Jan-4 May-4 Sep-4 Jan-5 May-5 Sep-5 Jan-6 May-6 Sep-6 Jan-7 May-7 Sep-7 Jan-8 May-8 Sep-8 Jan-9 May-9 Sep-9 Jan-1 May-1 Sep-1 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 Data Source: EIA 17

18 Thank You 18

19 US Crude Oil Exports by Destination Thousand bpd Others U.S. Virgin Islands Taiwan Korea Japan China Canada Data Source: EIA 19

20 Exemptions to the US crude oil export ban Crude oil derived from fields under the State waters of Alaska's Cook Inlet; Alaskan North Slope crude oil; Certain domestically produced crude oil destined for Canada, for consumption therein; Shipments to U.S. territories; Up to an average of 25, bbl/d of California heavy crude oil; In connection with refining or exchange of Strategic Petroleum Reserve oil; Foreign-origin crude oil where, based on written documentation satisfactory to BIS, the exporter can demonstrate that the oil is not of U.S. origin and has not been commingled with oil of U.S. origin; Exports that are consistent with findings made by the President under an applicable statute; Source: EIA 2

21 US Spot Clean Loadings by Vessel Type 35 Handy MR Pmax/LR1 Other Cargo Volume Million tonne-days Million Tonnes * Laden days based on 14 knots Data Source: Clarksons 21

22 US Crude Oil Production Main Producing States/Areas Changes in Annual Output 8-13 Others Federal Offshore - Gulf of Mexico California Alaska Texas North Dakota Texas North Dakota Alaska Million bpd Oklahoma New Mexico Offshore Gulf of Mexico Colorado California Jan-2 Oct-2 Jul-21 Apr-22 Jan-23 Oct-23 Jul-24 Apr-25 Jan-26 Oct-26 Jul-27 Apr-28 Jan-29 Oct-29 Jul-21 Apr-211 Jan-212 Oct-212 Jul-213 Data source: EIA Utah Wyoming bpd , 1,5 2, 22