‘Those in the oil market fearing a flood of OPEC supply next year will probably be better off preparing for a shortage’
The headline quote and the one above, are from the analysts Trafigura and from Citigroup in a Bloomberg report today. Both are predicting shortages by 2019. We had earlier predictions of the same by the Aramco chief earlier in the year. With supply falling by as much as 9 million barrels a day and demand from India growing very fast indeed, prices can only rise dramatically. Libya, Nigeria, Venezuela, Iran and Iraq are already pumping at their maximum capacity this year.
I know most readers want Scotland to become renewable energy-based, as I do, but in the debate over independence, low oil prices have been used (effectively?) against us.
Low oil prices have boosted demand for petrol greedy SUVs and the growth in the number of electric vehicles has come too late to avoid the impending shortages. According to Trafigura, it would take 12 years for the US to replace all petrol-based vehicles even if it started a massive programme now.
What about shale oil, some will ask? Well productivity in the biggest oil basin, the Permian, across the southern United states, is diminishing as costs rocket and investors pull out.
Once more, please don’t let this boom be used by a Westminster government to save its otherwise failed economic strategies.