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The impact of declining oil exports

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Dadang Tri/Reuters/File

(Read caption) An employee of Indonesia's state-owned oil company Pertamina walks past oil drums at the company's main depot in north Jakarta in this December 2004 file photo. Global oil exports have declined since 2006, Cobb writes.

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It is with trepidation that independent petroleum geologist Jeffrey Brown has watched global oil exports decline since 2006. With all the controversy in the past several years over whether worldwide oil production can rise to quench the world's growing thirst for petroleum, almost no one thought to ask what was happening to the level of oil exports. And yet, each year a dwindling global pool of exports has been generating ever greater competition among importing nations and has become a largely unheralded force behind record high oil prices.

Even though the trend in oil exports has been evident in the data for some time, the analyst community was caught by surprise when a Citigroup report released earlier this month forecast an end to oil exports in 2030 from Saudi Arabia, currently the world's largest oil exporter.

Brown, as you might expect, wasn't surprised at all. His own forecasting model, which he calls the Export Land Model, has been predicting more or less the same thing for some time. He doesn't think the Saudis will actually let exports to go all the way to zero because they'll probably want at least some revenue from exports. But "one to two million barrels per day of exports [from Saudi Arabia] between 2030 and 2040 will not be a big deal in the world," said Brown, who runs a joint venture exploration program based in Ft. Worth.

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