High oil prices are reducing demand around the world. This is happening at a time when energy companies need the capital from their historically high sales to continue their expansion in exploration and extraction of new reserves. As the large reserves they have depended upon for decades start to decline in production, they now have to work harder for less oil, literally ‘running to stand still’.
A result of the above trend will be ever higher prices (as a long term trend), and reduced availability.
In NZ, on the periphery of some very long supply chains, we need to be aware that this change is coming, and accept that the appropriate response is to reduce our dependence on oil as a matter of national urgency.
Update: Not long after I wrote this post, the EIA revised the oil consumption amounts by country that they had published a few days earlier. The numbers changed substantially for quite a few of the countries outside the US and Europe. While the trend is still to lower growth in oil usage in 2011 and 2012 in China and India than in 2010, the trend is less pronounced.
Furthermore, we now have another set of numbers to check against EIA’s oil consumption amounts. BP released Statistical Review of World Energy 2013 yesterday, June 12. A comparison of annual increases in oil consumption (on a barrels of oil per day basis, not adjusted for population growth) from the three sources is as follows:
There seems to be fairly consistent reporting of oil consumption for major OECD countries, but this is less the case for non-OECD countries. The lack of stability in…
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