| 1# > A < Posted 2011-5-31 14:40 Only show this user's posts China, US simply decide oil market's trend 
The U.S. summer driving season starts next week amid predictions that gasoline consumption in the U.S. will be lower than last year as squeezed motorists cut back due to high prices.
The U.S. summer driving season starts next week amid predictions that gasoline consumption in the U.S. will be lower than last year as squeezed motorists cut back due to high prices. Fear that this phenomenon will diminish overall oil demand has been a big factor in the recent fall in international oil prices from their April high of $127 a barrel.
However on the other side of the world, industry observers see the opposite situation due to the threat of electricity shortages in China. If power supply is tightly rationed this summer and the Chinese turn to backup oil-fired generators as they have in the past, oil demand may be significantly higher than previous predictions.
With the balance between global oil supply and demand seen increasingly tight, which of these countervailing trends proves stronger could have a significant impact on prices in the second half of this year.
"Power outages are estimated at between 30 gigawatts, by the China Electricity Council and 50GW, by South China Grid," said Eurasia Group analyst Robert Johnston. When the same thing has occurred in recent years, people have turned to back-up diesel generators to fill the gap.
 
China's Three Gorges Dam
Increased use of diesel generators has boosted Chinese oil demand by 400,000-600,000 barrels a day in previous summers, according to Barclays analysts. Many analysts, including the International Energy Agency, predict a more modest boost of around 300,000 barrels a day this summer as power shortages are are less severe than previous years, but still significant.
The picture in the U.S. is much less clear. The price of gasoline recently hit the $4 a gallon mark, which is widely seen as the point at which motorists start to reduce the number of miles they drive. But prices have fallen since then, and the strength of the U.S. economy remains difficult to assess.
Data is mixed. Gasoline stockpiles have increased for three straight weeks and most analysis shows consumption down by a couple of percentage points compared with last summer. However, a survey by travel and leisure group AAA last week predicted a fall of just 0.3% in the number of Americans driving to a vacation destination this summer despite high prices.
Estimates for U.S. gasoline demand this summer are all over the map. The U.S. Energy Information Administration still expects a year-to-year increase in liquid fuel consumption of 109,000 barrels a day, although it has trimmed this figure recently.
Another well-respected provider of energy data, the International Energy Agency, recently cut 190,000 barrels a day from its 2011 oil demand forecast this month, citing weak U.S. fuel demand. "We believe U.S. gasoline demand will indeed disappoint this year," it said in its monthly oil market report.
Until more data comes in it will be difficult to judge which of the two opposing forces will prove more significant. The most bearish view says current consumption trends, affected by the recent peak in prices, imply U.S. oil demand could fall by more than 1 million barrels a day, according to Petromatrix analyst Olivier Jakob. "The drop in US oil demand dwarfs the increase in oil demand from China," he said.
As the two biggest economies in the world, US and China both need enough oil to satisfy their developing. However, now the situation has entered a vicious circle that the oil shortage and high price slow down their developing speed on one hand, and on the other hand they keep rising the oil prices by endless consumption. What does the world gonna do to get out it? The situation is getting more and more serious and urgent now!   |
No comments:
Post a Comment