BP "Statistical Review of World Energy 2012": ... ...Saudi Arabia now trails Venezuela with a 16 percent share of world proven oil reserves... ...Canada ranks third with 175.2 billion barrels, or 11 percent of total...

Venezuela World’s Largest Holder of Proven Oil Reserves

By Saudi Gazette:



JEDDAH –

Venezuela surpassed Saudi Arabia to become the world’s largest holder of proven oil reserves, the BP "Statistical Review of World Energy 2012" said.

Saudi Arabia now trails Venezuela with a 16 percent share of world proven oil reserves, according to the report. Canada ranks third with 175.2 billion barrels, or 11 percent of total, unchanged from the revised number for 2010.

The South American country’s deposits were at 296.5 billion barrels at the end of last year, data from BP Plc show. Saudi Arabia held 265.4 billion barrels, BP report said. The 2010 estimate for Venezuela increased from 211.2 billion in the previous report.

"These reserves are quantified and certified by third parties and recognized by the entire world as being the biggest proven reserves of the world," Venezuela’s Oil Minister Rafael Ramirez said today in Vienna. "We have always said that in the future the natural resources will become scarce and when the economy recovers and demand will come back then we will be one of the few countries able to respond to that."

President Hugo Chavez of Venezuela wants to more than double the country’s oil- production capacity to 6 million barrels a day by 2019, according to a government plan released June 12. The world’s biggest oil-exporting nations faced a 15 percent slump in crude prices last month, the biggest decline since December 2008, on speculation Europe’s debt crisis would derail the global economic recovery.

Ramirez has said oil prices need to be higher than $100 a barrel. The recent slump in crude is dangerous for producers, the Oil Minister said June 12 in Vienna, where the Organization of Petroleum Exporting Countries is meeting today to decide production quotas.

Brent futures fell 14 cents, or 0.1 percent, to $96.99 a barrel on the ICE Futures Europe exchange at 4:04 p.m. London time Friday.

Global reserves advanced to 1.65 trillion barrels at the end of last year, a 1.9 percent increase from a revised 1.62 trillion in 2010, BP said. Venezuela now holds 18 percent of the world’s reserves, according to BP data.

BP revised its estimates on reserves in part because the company publishes its report in June, before most governments issue their annual reserves figures, said Robert Wine, a BP spokesman. Last year’s record average oil price also had an effect, increasing the commercial viability of hard-to-reach deposits, he said.

Venezuela’s deposits may be difficult to extract, according to Strategic Energy & Economic Research. "People still know that a lot of that is very hard to develop and is not as readily accessible the way Saudi reserves are," Michael Lynch, the researcher’s president, said today in Vienna. "It’s the same with Canadian oil sands."

Russia boosted its deposits to 88.2 billion barrels from a revised 86.6 billion a year earlier, according to BP. Russia’s share of the total is 5.3 percent. Reserves in Norway increased last year, snapping 11 years of declines, according to BP. The country’s deposits rose to 6.9 billion barrels, compared with a revised figure of 6.8 billion in 2010.

BP said the estimates in the report are a combination of official sources, OPEC data and other third-party estimates. Deposits include gas condensates and natural-gas liquids, as well as crude.

Global oil consumption increased 0.7 percent or 0.6 million barrels a day to reach 88 million barrels a day in 2011, marking the weakest global growth rate among fossil fuels in BP’s statistical review. Oil consumption in member countries of the Organization for Economic Co-operation and Development, or OECD, declined 1.2 percent to its lowest level since 1995, while oil consumption outside the OECD grew 2.8 percent in 2011, BP said.

"Despite strong oil prices, oil consumption growth was below average in producing regions of the Middle East and Africa due to regional unrest," the oil giant said.

China was the largest contributor to a rise in global oil demand growth in 2011, increasing its total oil demand by 505,000 barrels a day or 5.5 percent in 2011, although the growth rate was below its 10-year average, BP said. Meanwhile middle distillates were again the fastest-growing refined product category by volume, for the seventh time in the past 10 years, the oil major added.

In non-OPEC countries, output was broadly flat, with increases in the US, Canada, Russia and Colombia offsetting continued declines in mature areas such as the UK and Norway, as well as unexpected outages in a number of other countries. The US registered the largest increase among non-OPEC producers for the third consecutive year, driven by continued strong growth in onshore shale liquids output, which pushed US oil output to its highest level since 1998, BP said. – SG/Agencies

Published on Jun 19th 2012 at 9.35am

Source: Saudi Gazette

Venezuelanalysis

Oil and the specter of revolution

rian.ru



The uprisings in the Middle East and North Africa have caused prices surges in global commodity markets. Now the revolt in oil-rich Libya has brought oil prices to a level unseen since 2008.

The IMF has already revised its forecast of the average price per barrel of oil from $89.5 up to $94.75. Widespread unease and speculation are what's driving oil prices up for now. But if the riots spill over from North Africa to the Arabian Peninsula, there could be a physical shortage of oil in the world economy, sending prices as high as $150 per barrel.

Specter of revolution

The price of oil continues to rise. April futures on WTI oil have gone up $0.15 to reach $97.43 per barrel (as of 8:58 a.m. Moscow time). The price of April futures for North Sea Brent Crude has gone up by $1.29 to reach $112.65 per barrel.

Fears that the popular revolts in the Middle East could push up prices on hydrocarbons began to surface immediately after protests began in Egypt. While not a major oil-producing country, Egypt controls the Suez Canal, one of the world's key shipping routes.

The threat of shipping disruptions on the canal was enough to drive up March futures for WTI and Brent by 0.31% and 0.76% respectively in early February. But the prices subsided before long, as shipping through the Suez Canal continued seamlessly and Egypt appeared not to be the beginning of a domino effect that could destroy or at least shake up other regimes in the region. But this is exactly what happened. First the regime fell in Tunisia, then Egypt; now oil-rich Libya is in the grips of a bloody revolt. And the specter of revolution (albeit very faint) is already hovering over Iran and Saudi Arabia.

Gaddafi doubles down

The instability in Libya has contributed greatly to the soaring oil prices. The market was sent into a panic when Libyan strongman Muammar Gaddafi vowed to sabotage oil and gas pipelines and oil refineries in the country. In the several days since, the price of major oil brands has gone up by about 7%. Analysts are predicting that the price of oil could reach $120 per barrel as early as March.

For the time being, the price increases are the result of speculators sowing panic on markets. It is unclear how much Libya has actually reduced oil production. Some experts claim the production has declined by about 400-500 barrels per day, while others think it's double that amount. Regardless, Libya only produces about 1.6 million barrels of oil per day, or roughly 2% of global output.

If oil production falls by about one third in Libya, global output will go down by about 0.6%. Moreover, OPEC has already promised to increase production to offset the shortage from Libya, and the cartel, with its vast resources, will have no trouble making good on this promise. In other words, there is no threat of a physical shortage of oil, nor of a realignment in the oil market.

Real trouble will begin only if the chain reaction of revolt reaches the oil-rich countries of the Arabian Peninsula, primarily Saudi Arabia, which accounts for 10% of the world's oil. If oil production was to be disrupted in Saudi Arabia, this would deal a serious - though far from fatal - blow to the world economy.

A lose-lose situation

Oil prices are determined by a host of other factors, for instance, global and U.S. economic growth, and the level of oil reserves in America. Gaddafi's threat to destroy his own oil infrastructure happened to coincide with the news last week that oil reserves in the United States grew three times slower than projected, on top of an overall decline in oil reserves of late. On the other hand, forecasts of U.S. economic growth have become more optimistic.

True, we may have to revise down these sunny forecasts very soon, at least if the trend of sharply rising oil prices continues. Economic growth has always depended greatly on oil prices. For the time being, experts do not see a direct threat to the global economy, but let's not forget that speculation-fueled spikes in fuel prices in 2007-2008 was a direct cause of the global economic downturn.

As Prime Minister Vladimir Putin noted at a news conference in Brussels yesterday (http://www.rian.ru/economy/20110224/338310436.html), the Russian economy would not benefit from the further growth of prices on hydrocarbons: "We realize that if global economic growth slows down, this will have a negative impact on our economy as well."

True, higher prices on hydrocarbons will increase Russia's export revenues. But oil is less a blessing for our country than "the devil's excrement," as Juan Pablo Perez Alfonso, one of the founders of OPEC, called it. The discovery of deposits in Western Siberia and steadily rising oil prices in the early 1970s lulled the U.S.S.R. into abandoning much-needed economic reforms.

Today, the fuel and energy sector is both the engine of the Russia economy and its anchor. Russia's abundance of oil has allowed the government to carry out social programs. It has helped finance Russia's recovery from the economic crisis, and much, much more. But Russia's oil-based economy is one of the main causes of its technological backwardness, the enormous disparity between rich and poor, and corruption.

There is also a factor of addition. Just as a sick person gets addicted to medicine, our raw materials-based economy becomes addicted to high oil prices. Even if oil prices reach pre-crisis levels, we still won't be able to patch the hole in the budget and achieve pre-crisis economic growth rates.

23:42 25/02/2011

rian.ru

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