Oil Glut & Price Crash?

The graph is from the presentation for BP's 2017 Energy Outlook published during January. This graph argues that the world is facing another glut of oil. The bar on the left is the worlds resources thought to be recoverable with today's technology, the bars on the right show the expected total cumulative demand over 2015-2035 and 2015-2050.

At the weekend the head of the International Energy Agency has also warned that oil prices could fall sharply this summer as American shale drillers raise output to take advantage of the recent market recovery. According to Fatih Birol, the recent stability in crude prices could turn out to be shortlived. ‘The name of the game [this year] is volatility,’ he said. ‘We are entering a period of greater volatility.’ Dr Birol added that it was too soon to say exactly what the impact of the Trump administration would be on global energy markets, though he ‘wouldn’t be surprised’ if the US became a powerhouse in oil and gas exports.