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OPEC+ versus USA: A battle for balancing the market which cannot be won in the long run
Centre Energie - Centre for Energy
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Marc-Antoine Eyl-Mazzega
Director
Valdai Conference, Moscow, 19-20/02/2019
OPEC+: Saudi Arabia is the swing supplier, growth in non-OPEC supply meets 4/5 of incremental global demand
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Evolution of liquids production by leading global suppliers, 2016-2018 (in kbd)
Source: IEA, OPEC, Ifri
8 11 14 17 20 23 26 29 32 35 38 41
Share of Saudi Arabia in total globalsupplies
Share of Russia in total global supplies
Share of USA in total global supplies
Share of OPEC in total supplies
Share of OPEC in global trade
2018 2017 2016 2015
Oil market structure in % of global supplies and trade, 2015-2018
Boom in North American exports can compensate for sharp drop of Iranian exports by May, supply squeeze could backlash
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Evolution of US crude oil exports, 2015-2018, kbd
Source: EIA
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500
1000
1500
2000
2500
Shifting geopolitics of global petroleum trade: China and India face new vulnerabilities in the Middle East
4Source: EIA, statistical data from countries’ customs
China’s 2017 oil imports by country (in % of value) (8,4 mb/d)
India’s 2017 oil imports by country (in % of value) (4,4 mb/d)
Change in crude imports of India, China and EU, 2010 and 2018 (mb/d)
OPEC+ producers’ economies hit by the fall of oil prices in 2015 and saved by its rebound in 2017
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GDP growth, selection of OPEP+ producers, 2012-2017
Source: IMF
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GDP growth, selection of OPEP+ producers, 2012-2017
Source: IMF
Most producers are vulnerable yet pay no credible effort to economic diversification especially since prices recovered
7Source: IMF
Russia’s economy is stagnating, cautious budget but can public spending foster sustainable growth?
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USD/barrelGDP, %
GDP growth,% yoy
Urals averageprice, USD/bbl
Evolution of Russia’s GDP and oil prices, 2002-2018
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Share of EV or hybrid vehicles in the total global fleet, 2010-2050e
0%
5%
10%
15%
20%
25%
30%
2010 2015 2020 2025 2030 2035 2040 2045
IEA
BNEF
BP
ExxonMobil
OPEP
Statoil
Linéaire (IEA)
Linéaire (BNEF)
Linéaire (BP)
Linéaire (ExxonMobil)
Linéaire (OPEP)
Linéaire (Statoil)
Demand peak not near, but could come quicker than many expect, while demand growth already slows
Saudi Arabia is working to free up more oil for exports, which creates new opportunities
9Source: IEA
Power generation mix, 2000 Power generation mix, 2016
31 GW of oil fired power generating capacity that could be progressively reduced to a summer peak load tool
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Installed electric power capacity by fuel in %, 2017 Installed electric power capacity by fuel in GW, 2017 (including desalination)
Source: KAPSARC
Saudi Arabia’s power mix transformation will add spare export capacity & foster security but question its OPEC role
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Potential longer term energy mix, summer and winter (GW)
Source: King Abdullah City for Atomic and Renewable Energy K.A. Care www.kacare.gov.sa
Centre Énergie – Centre for Energy
27, rue de la Procession, 75740 PARIS CEDEX 15Tél. +33 (0) 1 40 61 60 00 • Fax : +33 (0) 1 40 61 60 60
www.ifri.org
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