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Is This The New Sweet Spot For Shale?

Shale drillers and oil majors…

2015 Could Be The Year Of Peak Oil

2015 Could Be The Year Of Peak Oil

The EIA has finally updated their International Energy Statistics with data through February 2015. All data in the charts below are Crude + Condensate and is in thousand barrels per day with the last data point February 2015.

(Click to enlarge)

World C+C dropped 477,000 bpd in January and another 65,000 bpd in February for a total decline of 542,000 bpd. World C+C stood at 79,160,000 barrels per day in February.

(Click to enlarge)

Non OPEC C+C declined 244,000 bpd in January and another 100,000 bpd in February for a total decline of 344,000 since December. Non-OPEC C+C production stood at 46,656,000 bpd in February.

(Click to enlarge)

OPEC C+C, in February 2015 stood at 32,504,000 bpd, down 1,451,000 bpd from its peak in April 2012. However according to the OPEC MOMR their crude only is up 1,000,000 bpd from February to May. Related: The Latest Industry On EPA’s Emissions Hitlist

(Click to enlarge)

According to the EIA’s International Energy Statistics US C+C production, in February, stood at 9,238,000 bpd. It was down 14,000 bpd in January but up 24,000 bpd in February for an increase of 10,000 over those two months.

An interesting point here is while US C+C was up 10,000 bpd from December to February, US total liquids were down 297,000 bpd. That was because over that two month period they have NGLs down 20,000 bpd, refinery process gain down 150,000 bpd and other liquids down 136,000 bpd.

(Click to enlarge)

In spite of the huge rig count decline in Canada the EIA says they were up 99,000 bpd in January and up another 22,000 bpd in February. Canada’s C+C production stood at 3,901,000 bpd in February. Related: Shale Resources Key To Deciding Argentina’s Future

(Click to enlarge)

China, after reaching a new high in December fell 83,000 bpd in January and another 14,000 bpd in February. China’s C+C production, in February, stood at 4,218,000 bpd.

(Click to enlarge)

Russia’s C+C reached 10,220,000 bpd in January, barely topping the 10,209,000 bpd of November 2013. Their C+C production however dropped 70,000 bpd in February and stood, at that point, at 10,150,000 bpd.

The page Non-OPEC Charts has been updated with charts of all non-OPEC producers.

There has been a lot of discussion on this blog lately as to whether US crude production, in the last few months has been up or down. The EIA’s Weekly Petroleum Status Report has U.S production soaring in 2015, reaching new highs almost every week. However the EIA’s own Drilling Productivity Report has shale oil, the source of almost all US production gains, peaking in April with an increasing decline in May, June and July. And reports from individual states seem to indicate that the decline started even earlier. Related: Petrobras May Be Selling But Is Anyone Buying?

Platts mentions Eagle Ford was down 8,000 bpd in April and down another 6,000 bpd in May. And we know from the NDIC Stats that North Dakota production in April was down almost 22,000 bpd in April and down almost 60,000 bpd since peaking in December. Platts however says Bakken production was basically flat in May, up a mere 650 bpd. Accurate to 10 bpd? I seriously doubt that.

I am betting that when the June data finally comes in that it will show crude oil production in the US has seriously declined since December 2014. And it is likely Canada has done likewise.

This chart shows OPEC crude only production through May. They have increased production by 1,000,000 bpd since February but they are all pumping flat out to achieve that.

I am now more convinced than ever that 2015 will see the peak in world crude oil production. I have very closely studied the charts of every producing nation and my prognosis is based on that study. I see many nations in steep decline and most every other nation peaking now, or in the last couple of years, or very near their peak today. These include the world’s three largest producers, Russia, Saudi Arabia and the USA.
Many other nations are at or have reached their peak in the last few years. These include other producing giants such as Kuwait, the UAE, Brazil and China. Other non-giants are peaking or have recently peaked include Colombia, Oman, and India. Only Canada, and Kazakhstan have any real upside potential and I am not too sure about Kazakhstan.

I know many will point to Venezuela but that is just not going to happen. Venezuela does have vast potential but also has vast political problems and a history of confiscating foreign assets and paying them pennies on the dollar. So don’t expect anything but a slow decline from Venezuela for the next decade or so.

By Ron Patterson

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Leave a comment
  • zipsprite on June 23 2015 said:
    What about Iran?
  • carlosg on June 23 2015 said:
    Or Iraq?
    Or Libya?
    Or ISIS?
    Or if US oil producers manage to cut cost below US$60/bbl?
    Or development of untapped shale oil in South American, Russia, Europe and China?

    Shouldn't you be calling peak oil once all the known reserves around the world has been fully developed and in full production mode?
  • JIM on June 24 2015 said:
    All you are showing is the effect of OPEC dumping on the market to suppress non-OPEC production. It has nothing to do with the amount of oil in the ground.
  • Askja Energy on June 28 2015 said:
    It would be interesting with a graph, showing world C+C minus US shale/tight oil.
  • allister on July 18 2015 said:
    Well 2015 was mentioned - remember the german military report leak of a few years ago....
  • Luke on July 29 2015 said:
    We have fossil fuel economy's that were built on cheap($20 to $40 historically), available high grade oil.

    Its no longer cheap.
    its no longer easy to get.
    its of mixed consistency, i.e. tar sands, shale, conventional.
    its no longer going to be a case of drill another well and pump.
    Energry returned on energy invested in 1950 was roughly 100:1. today its 9:1 and falling.

    There is NOTHING in our entire book of scientific knowledge that can replace, conventional oil in the volumes needed.

    Shale oil producers need $80 on the b before they break even. The balance sheets of U.S. shale producers are being shot by Saudi Arabia dumping as much product as they can whilst there's still some steam left in the Global economy before demand flops again, this time sparked by China. U.S. Shale can only continue for as long as banks are willing to continue their credit lines.

    You don't need to be an economist / mathematician / prophet to see that if your

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