legislative news, studies and analysis - u.s. eia’s liquid fuels … · 2011-08-16 · 2012-2016:...

www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis

U.S. EIA’s Liquid Fuels Outlook

NCSL 2011 Energy Policy Summit: Fueling Tomorrow’s Transportation

John Staub, Team Lead

August 8, 2011 | San Antonio, Texas

Overview

John Staub | San Antonio, TX

August 8, 2011 2

• Oil demand

• International and domestic supply

• Prices

• Potential impacts of domestic production on imports and

prices

• Concluding remarks

Non-OECD countries account for vast majority of the nearly

50% projected increase in global energy use by 2035

3John Staub | San Antonio, TX

August 8, 2011

energy consumption

quadrillion Btu

Source: EIA, International Energy Outlook 2010

Non-

OECD

OECD

USA

50%

50%

62%

38%

Primary energy use by end-use sector, 2009-2035

4

U.S. energy use

quadrillion Btu

Source: EIA, Annual Energy Outlook 2011

Industrial

Residential

Transportation

Commercial


August 8, 2011

Renewables grow rapidly, but under current policies fossil fuels

still provide 78% of U.S. energy use in 2035


August 8, 2011

U.S. primary energy consumption

quadrillion Btu per year


History Projections2009

37%

25%

21%

9%

7%

1%

33%

24%

21%

10%

8%

3%

Shares of total U.S. energy

Liquid fuels consumption by sector, 1990-2035

6

U.S. liquid fuels use

million barrels per day


ProjectionsHistory 2009


August 8, 2011

Buildings

Industrial

Transportation

Electric power

Most transport fuel growth is in light and heavy duty vehicles


August 8, 2011

U.S. transportation energy consumption

million barrels per day oil equivalent


Rail

Air

ProjectionsHistory

Heavy-duty vehicles

Light-duty vehicles

Marine

2009

4%

67%

2%

10%

16%

64%

20%

9%

4%2%

New light duty vehicle fuel economy achieves almost 38 mpg by

2035 in the Reference case, lowering fuel demand by about 3 million

barrels per day

8

miles per gallon


2009 ProjectionsHistory

Summary of standards

2012-2016: 34.1 mpg CAFE average (based on NHTSA vehicle footprint sales distribution)

2020: 35 mpg by statute

2017-2025: Reference case does not include proposal released this past month


August 8, 2011

FFVs make up the largest share of unconventional vehicles, which

account for 40% of U.S. light-duty vehicle sales in 2035

9

U.S. light car and truck sales

millions



August 8, 2011

On-road fuel economy of new medium and heavy heavy-duty

vehicles in two cases, 2005-2035

10

new vehicle fuel economy

miles per gallon gasoline equivalent



August 8, 2011

Fuel Economy Standards

ReferenceHeavy heavy-duty vehicles

Medium heavy-duty vehicles

Supply


August 8, 2011 11

Unconventional sources more than triple globally, but

conventional petroleum continues to comprise the vast majority

of liquids supply

12

global liquids production




OPEC conventional

Non-OPEC conventional

Unconventional12%

47%

40%

39%

5%

56%


August 8, 2011

U.S. reliance on imported liquid fuels is reduced by increased

domestic production and greater fuel efficiency


August 8, 2011 13


Consumption

Production

Net imports

ProjectionsHistory

44%

52%60%

peak


2009

U.S. imports of liquid fuels fall due to increased domestic

production – including biofuels – and greater fuel efficiency

14

U.S. liquid fuels consumption



ProjectionsHistory

Natural gas plant liquids

Petroleum supply

Biofuels including imports

Net petroleum imports

2009

13%

11%

41%

32%

10%

52%

34%

4%

Liquids from coal

3%


August 8, 2011

Domestic crude oil production by source 1990-2035

15



Total

Lower 48 onshore

Lower 48 offshore

Alaska

History Projections2009


August 8, 2011

Offshore crude oil production in four cases, 2009-2035

16

U.S. crude oil production




August 8, 2011

High OCS Cost

Reference

Reduced OCS Access

High OCS Resource

Domestic biofuels production displaces 1.25 million barrels per day

of gasoline and 0.36 million barrels per day of diesel by 2035


August 8, 2011 17

U.S. biofuels production



Starch ethanol (mostly corn)

Prices


August 8, 2011 18

Oil demand and consumption:


August 8, 2011 19

• Oil consumption is determined by demand drivers and price

• Demand is closely related to the state of the global economy

– oil is an input into industrial production and the transport of goods

– household income and employment drive personal transport demand

• Demand in recent years has come increasingly from non-

OECD countries, led by China

– growth expectations for Asia ex-Japan approached 10% by 2010

• Price increases tamp-down fundamental demand drivers

– the net effect on consumption depends on the relative strength of price impacts

and economic growth

The majority of global liquids consumption and production

occurs in a limited number of countries


August 8, 2011 20

0 5 10 15 20

Canada

Korea, South

Germany

Saudi Arabia

Brazil

Russia

India

Japan

China

United States

Million barrels per day

Liquid fuels consumption, 2009

0 5 10 15 20

Kuwait

Brazil

UAE

Mexico

Canada

China

Iran

United States

Saudi Arabia

Russia

Liquid fuels production, 2009

Source: EIA estimates

60% of global

liquid fuels

consumption

60% of global

liquid fuels

production

Average annual world oil prices in three cases, 1980-2035

21

annual average price of low-sulfur light crude oil

real 2009 dollars per barrel



High Oil Price

Low Oil Price

Reference


August 8, 2011


August 8, 2011 22

OPEC production often acts to balance the oil market;

OPEC quota cuts tend to lead to price increases


August 8, 2011 23

million barrels per day change (year-on-year) percent change (year-on-year)

Sources: EIA, Thomson Reuters

Energy and Financial Markets: Crude oil price drivers


August 8, 2011 24

During 2003-2008, OPEC’s spare production levels were low,

limiting its ability to respond to demand and price increases


August 8, 2011 25

spare capacity (million barrels per day) price per barrel (real 2009 dollars)

Source: EIA Short Term Energy Outlook (July 2011), Thomson Reuters

spare capacity < 2.5 million barrels per day Forecast

0

20

40

60

80

100

120

140

0

1

2

3

4

5

6

7

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

OPEC spare capacity (left axis)

WTI crude oil price (right axis)

The years 2003-2008 experienced periods of very strong economic and oil

demand growth, slow supply growth and tight spare capacity


August 8, 2011 26

percent change (year-on-year) price per barrel (real 2009 dollars)

Sources: EIA Short Term Energy Outlook (July 2011), Thomson Reuters

spare capacity < 2.5 million barrels per day

* World capacity = OPEC capacity plus non-OPEC production

Forecast

-135

-90

-45

0

45

90

135

-6

-4

-2

0

2

4

6

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

World liquid fuels production capacity* (left axis)

World GDP (left axis)


-90

-45

0

45

90

135

-4

-3

-2

-1

0

1

2

3

4

5

6

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

World liquid fuels consumption (left axis)

World GDP (left axis)


Rising oil prices held down global oil consumption growth from

2005-2008, despite high economic growth


August 8, 2011 27

percent change (year-on-year) price per barrel (real 2009 dollars)

Sources: EIA Short Term Energy Outlook (July 2011), Thomson Reuters

Forecast

For more information


August 8, 2011 28

U.S. Energy Information Administration home page | www.eia.gov

Short-Term Energy Outlook | www.eia.gov/steo

Annual Energy Outlook | www.eia.gov/aeo

International Energy Outlook | www.eia.gov/ieo

Monthly Energy Review | www.eia.gov/mer

EIA Information Center

[email protected]

Our average response time is within three

business days.

(202) 586-8800

24-hour automated information line about EIA

and frequently asked questions.

http://www.eia.gov/

http://www.eia.gov/steo

http://www.eia.gov/aeo

http://www.eia.gov/ieo

http://www.eia.gov/mer

mailto:[email protected]

Multiple factors have contributed to crude oil resource estimate

increases over the years, with tight oil contributing recently

29

U.S. crude oil and lease condensate resources in non-prohibited areas

billion barrels

(1) Prior to AEO2009, resources in Pacific, Atlantic, and Eastern GOM OCS were under moratoria and not included.

(2) Includes shale oil. Prior to AEO2011, tight oil is included in unproved other lower-48 onshore category.


August 8, 2011

Recent Annual Energy Outlook natural gas resources

30

U.S. dry natural gas resources

trillion cubic feet

Source: EIA, Annual Energy Outlook 2011 and earlier editions

Unproved

shale gas

Unproved

other gas

(including

Alaska and

offshore)

Proved

reserves

(all types &

locations)

827

245

1472

2543

John Staub | San Antonio, TX August 8, 2011

Over the last decade, U.S. shale gas production has increased 14-

fold and now comprises about 22 percent of total U.S. production


August 8, 2011

annual shale gas production

trillion cubic feet

Sources: EIA, Lippman Consulting

0

5

10

15

20

25

30

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035

2%

Shale gas offsets declines in other U.S. supply to meet

consumption growth and lower import needs


August 8, 2011

U.S. dry gas

trillion cubic feet per year


Non-associated offshore

ProjectionsHistory

Associated with oil

Coalbed methane

Net imports

Non-associated onshore

Shale gas

2009

11%

1%

9% 7%

9%9%

20%

14%

8%

8%

6%

46%

Alaska 1%

Tight gas28%22%

Natural gas consumption is quite dispersed; industrial and

electric power use drives future demand growth


August 8, 2011

U.S. dry gas consumption

trillion cubic feet per year

*Includes combined heat-and-power and lease and plant fuel. **Includes pipeline fuel.



Industrial*

Central electric power

Commercial

Residential Transportation**

35%

18%

14%

30%

3%

32%

21%

14%

30%

3%

Accessing EIA Data on


August 8, 2011 34

• Prices

• Spot prices for WTI, Brent and products at various U.S. locations

• Futures prices for several contracts traded on NYMEX

• Production

• Financial Markets Dashboard and the Short Term Energy Outlook

database contain crude oil and product production data

• Consumption

• Financial Markets Dashboard and the Short Term Energy Outlook

database contain liquid fuel demand and consumption data

• Inventories

• EIA has both domestic and international inventory levels

• Financial Data

• The Financial Markets Dashboard contains the financial data that we are

allowed to share outside of EIA

• The Market Prices and Uncertainty Report also contains data and

analysis which is updated monthly

http://www.eia.gov/dnav/pet/pet_pri_spt_s1_d.htm

http://www.eia.gov/dnav/pet/pet_pri_fut_s1_d.htm

http://www.eia.gov/finance/markets/

http://www.eia.gov/steo/cf_query/index.cfm



http://www.eia.gov/dnav/pet/pet_stoc_wstk_dcu_nus_w.htm



http://www.eia.gov/steo/uncertainty.html

Biofuels, natural gas liquids, and crude oil production are key

sources of increased domestic liquids supply

35

U.S. liquid fuels



Net product imports

Net crude oil imports

Natural gas plant liquids

Liquids from coal

Gulf of Mexico

Crude oil production

Biofuels (including net imports)

Refinery processing gain

Total consumption


August 8, 2011

Crude oil production by source, 1990-2035


Lower 48 offshore

Projections

36

History


Other Advanced

Biofuels fall short of the goal in 2022, but exceed the 36 billion

gallon RFS target by 2031

37

billions ethanol-equivalent gallons


Legislated RFS in 2022

RFS with

adjustments under

CAA Sec.211(o)(7)

Biodiesel

Net imports

Cellulosic biofuels

Corn ethanol

legislative news, studies and analysis - u.s. eia’s liquid fuels … · 2011-08-16 · 2012-2016:...

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