BP Statistical Review of World Energy, June 2005

So I went to BP’s web site and requested they send me their latest world energy report. BP used to be British Petroleum before they wanted to go global (and American), so then they began pushing that BP stood for “Beyond Petroleum”. They also changed their logo to a green and yellow one that makes them seem more eco-friendly.

I read the report on the plane and found some very interesting information in it. It’s really an excellent report and I’d recommend you get one. It’s free and very comprehensive!

Consumption of gasoline is stagnating in North America and the UK. Perhaps the dire situation we complain that we’re in has already begun to be strongly recognized macroeconomically. Sometime soon, consumption will turn, and while we will still be consuming a large amount of oil and natural gas, the amount that we consume will begin to actually decrease!

At current rates, the US only has 11.1 years left of proved reserves. North America and Asia have the lowest amount of years of proved reserves left. Transitioning will be the big thing in the next couple decades. I’d predict the hot money would go here as energy companies re-position themselves.

Daily oil production in the US has dropped by a million barrels in a decade, from 8.4 million to 7.2 million barrels daily. It seems as though the US has stopped using its own reserves in favor of purchasing it from other countries. What this means is that the US is concerned about saving its energy for war and reserves and that it will be more independent than other countries financially and in terms of energy when a transition takes place to other methods of extracting energy.

Oil production in the Middle East has grown little in a decade. Iraq’s is below pre-war levels.

China’s coal consumption accounts for 75% of the 6.3% increase in world coal consumption in 2004.

The US consumed 20.5 million barrels daily in 2004 as compared to 17.7 million in 1994. China, which consumed 3.2 million in 1994, consumed 6.7 million in 2004. Europe’s consumption has stayed relatively constant over the same decade.

The price of Brent crude reached $12.72/barrel in 1998. As of 2004 it was $38.27. As you know, it has now topped $67/barrel. This is massive growth and the effect of inflation must be killing fast-growing countries like China.

Brent Crude

US refinery capacity has not grown much since 1994, from 15.4 million to 17 million per day. Refining capacity in Europe has dropped in the same period. Where’s oil being refined? Asia. China is now refining 5.8 million barrels/day, compared to 3.6 million in 1994. India is also increasing its capacity. They can still refine far less than us, but the difference is that we are readying to transition while they are still catching up.

The US is importing 12.9 million barrels a day compared to 8.9 million in 1994. This is a massive increase. Japan is importing less! Canada is exporting much more barrels than it was in 1994.

Japan and France seem to be embracing nuclear power. At this clip, French nuclear energy could pass up the U.S. in terms of consumption, within the next decade. Growth of US atomic energy has paused but perhaps in light of recent events that will pick up again.

American hydroelectric power has dropped off considerably but has increased in Brazil and China. China is seeking many different forms of energy to fulfill its needs. Even going so far as to mine for the dirty, cheap coal.

No one’s taken a turn for the better yet. Europe and North America have reached maximum limits I think — good policy could help reverse course considerably. I hope it comes soon. That gasoline has gone up 45 cents in a month and a half is ridiculous — refining capacity is the bottleneck and it’s weird that capacity has not increased to keep up with demand. Seems a little fishy to me! Especially since there’s plenty of crude lying around, more than we’ve ever thought.

You can view the whole report here.