#oges oil price presentation dr. lynch- dr.sorin- dr.eve-giorgos-casper

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OIL PRICE: Calculation, Prediction and Impact M

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Our Distinguished SpeakersOges Webinar on Oil Price(Calculation, Prediction and Impact)

Dr. Sorin DobircianuDirector of GSG Romania, Universal Premium Luxemborg,Operations Director- Expert Energy Co.

Dr. Mike LynchPresident, Strategic Energy and Economic Research, a consultancy

Giorgos BelerisLead Oil Analyst, MEA,Thomson Reuters

Dr.Eve SpruntAuthor, Award Winning Energy Leader, Ex-SPE President

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Casper Sønderby Head of Projects, AH Industries


Dr. Michael C. Lynch is president of Strategic Energy and Economic Research, a Massachusetts-based consultancy. He held a number of research positions at M.I.T. and was chief energy economist at DRI-WEFA. He currently blogs at forbes.com, and his publications have appeared in six languages. Praeger will publish his book The Peak Oil Scare and the Coming Oil Flood in June 2016.

• ARE PRICES STOCHASTIC?● NO, JUST COMPLEX

• ECONOMIC BOTTOM VERY LOW● BUT TRADERS DECIDE

• GOVERNMENT POLICY EXTREMELY IMPORTANT● SAUDI VIEW OF SUSTAINABLE PRICE● HOW MANY OTHERS EQUAL SAUDI ABILITY TO CUT?

• PAST COLLABORATORS: VENEZUELA, MEXICO, OMAN, RUSSIA, NORWAY• NEW SPIKE ALWAYS A POSSIBILITY


FORECASTING OIL PRICES

LAST YEAR’S PRICE FORECAST SURVEY DOE

CHANGE IN OIL BALANCE (MB/D)

IEA DATA AND FORECAST.

CHANGE IN CALL ON OPEC (MB/D)

IEA DATA AND FORECAST

OECD INVENTORIES (MB)


KEY FACTORS

• CHINESE ECONOMY● GLOBAL ECONOMY

• US SHALE OIL• IRANIAN SUPPLY• POLITICAL UNCERTAINTIES

● VENEZUELA● LIBYA


HOW DID SHALE GAS SURPRISE?

• OVERESTIMATED COSTS• MASSIVE IMPROVEMENT WITH TIME

● COST/WELL DOWN 50% OR MORE● WELL PRODUCTIVITY SOARING

• SHIFT IN FOCUS● MARCELLUS AND UTICA REPLACE BARNETT

• HIGH WELL PRODUCTIVITY• HIGH NGLS CONTENT

• CAN SHALE OIL DO THE SAME?

SHALE GAS SURPRISE


SHALE OIL: BOOM OR BUST?

• BOOM AT $100, BUST AT $50?• SOME SEE HIGH COSTS

● BERMAN: 1% OF BAKKEN WELLS PROFITABLE● MOST STATIC ESTIMATES

• DRILLING HAS DROPPED SHARPLY• NEARLY ALL BREAKEVEN ESTIMATES AT $60

● MANY HIGHER• LARGER COMPANIES REPORT SIGNIFICANT PROFITS AT $50/BBL

● SMALL PRODUCERS HAVE HUGE DEBT LOADS

EVOLUTION OF B/D PER RIG

RIG COUNT IN OIL SHALES

PRODUCTION IN PRIMARY OIL SHALES

READING SUPPLY CURVES

MARGINAL COST IS D, BUT NOT A PRICE FLOOR. LARGE PRICEDROP CAN BE SMALL VOLUME DROP.


PRICE RESTORATION• SAUDIS REVERSE COURSE

● ACCEPT WEAKNESS AS TEMPORARY• SMALLER MEMBERS REACH AGREEMENT

● NEED TO ABSORB 1 MB/D FOR A YEAR (STOCKS)• NON-OPEC DROPS SHARPLY

● SHALE• DEMAND BOOM

● CHINESE ECONOMY ESPECIALLY● LOW PRICES’ IMPACT

• SUPPLY DISRUPTION● VENEZUELA (BUT TEMPORARY)

• PRICE CEILING: SHALE OIL COSTS

SAUDI PRODUCTION


EXPECTATIONS• ECONOMIC RECOVERY IMPORTANT• SHALE OIL MIGHT SURPRISE

● MODERATE GROWTH 0.5 MB/D POSSIBLE• IRANIAN OIL WILL KEEP PRESSURE ON MARKET• PRICE FORECASTS

● PICKENS: $70 IN 6 MOS.● CITICORP: $51 IN 2016● JP MORGAN: $51.75 2016

SHORT-TERM WTI FORECASTS

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BOOK BY DR. LYNCH..

Oil, though finite, is in much better supply than many renewable resources..


Dr.Sorin Dobircianu works extensively with numerous Canadian, Romanian and international companies in foreign capital investment projects.He has served as principal advisor and expert to more than 15 companies, to name a few: LukOil, Terra Active International, Eagle Group Irak. With more than 20 years in the industry Dr. Sorin brings to the table expertise in issues related to markets development and access, political positioning, crisis management/avoidance,multi-state lobby and promotion campaigns.He has helped establish partnering agreements with multinational corporations and is involved in the promotion of certain high-profile regional and global energy securityin the Middle East, the Caspian Sea Region, China, the Russian Federation, the USA and Europe.Dr. Sorin has authored several scientific research and educational works including the global best seller on strategic and management issues entitled “The Management of Communication for business.” He holds Ph. D. in Oil, Gas and Mines from the Petroleum and Gas State University Romania.


Principal Factors for OIL PRICE Calculations

● International Trade● International Relations● Overseas Energy Policies● National Defense and Intelligence● Financial Programs for Different Governments

*Poll Question (on Screen) : Connections to Banking System impacting Oil Prices?YESNO


Oil & Gas Markets & Macro Systems

● China - Russia Relationship● Japan- Russia Relationship● Southeastern Asia Macro System Strategy - Sync with Hong

Kong & China● Notheren America(Texas) - Canada, ● BRICS● RIAC(Russian International Affairs Council)


Upcoming Strategies and Endeavors in Global Oil & Gas Market

● Asia- US● Europe● Middle-East● Black Sea Energy Region


Strategic International Alliances in Europe and elsewhere..


The Pivotal Role of Players from East and West

● Marsh McLennan Companies● Podesta Group● Manatt Global Jones● Shell● BP● Royal Dutch● IFP (Paris)● Confindustria (Italy)

● Defence Unlimited (www.defenceunlimited.con)

● Anderson Canada (www.andersonconsulting.info)

● H2Oil UK (British Group) (www.h2oil.co.uk)

● Universal Premium Luxembourg● Criabo Amsterdam

(http://universal-premium.com/investment_fund.html)


How To Survive The Current Drop In Crude Oil Prices?


Eve Sprunt, Phd, is a consultant with more than 35 years of experience as an executive and research scientist in the petroleum industry, including Chevron’s worldwide university recruiting. She was specifically honored for game-changing contributions to the petroleum industry, to the science and practice of geosciences and petroleum engineering, and to the advancement of women engineers by Society of Petroleum Engineers.With more than 3 decades in oil & gas, Eve is an expert in bringing ideas and experiences together to create new solutions and opportunities for the community at large. It would be very interesting and a privilege to hear about her new book “A GUIDE FOR DUAL-CAREER COUPLES: REWRITING THE RULES”


Shale Technology has written new rules :With the "shale" reservoirs :

● lower quality resources can also produce economically.● there is increase in the volume of new potential resources.

As US shale reservoirs can be developed at relatively low cost,

● the major oil companies no more control the business ● as soon as price recovers, many companies will get back in the game.

Reflecting On Market Dynamics: Impact Due to US Shale

Oges Poll Question 4: (on Screen)New technology applied to Shale has unlocked new resources? YESNO


Oil Price Fluctuations during Oil Cycle and Demographics

● Oil is a commodity , thus its price walks through boom-bust cycles. ● Inflation adjusted price charts show oil price tends to be low with the peaks unsustainable.

(Inflation adjusted price charts at www.inflationdata.com)

● Oil price affects the workforce diversity & composition

Reflecting On Market Dynamics: Impact on Work Force

Change in Age Demographics of the Society of Petroleum Engineers

• Petroleum industry age demographics are impacted by oil price

• During tough times - • few people are hired• older workers retire

Changing Gender Mix in Society of Exploration Geophysicists

• A higher percentage of younger people in the oil industry are female

• 7% of SEG members 55 to 64 are female

• 32% of SEG members 18 to 24 are female

Workforce of the Future Members of Dual-Career Couples

• Technical women more likely to be in couple of “equal earners” who each provide 40 to 60% of household income

• Younger men more likely to be in an “equal earner” couple

From 2013 Survey of the Society of Exploration Geophysicists with nearly 1600 responses Eve Sprunt, Nancy House, and Maria Angela Capello, SEG survey on dual career-couples and women: The Hidden Diversity of Dual-Career Couples, The Leading Edge, 2014, v. 33, No. 7, pp. 812 - 816.


Reflecting On Market Dynamics: Impact on Community, specifically on Women in Oil & Gas

*You may book your copy of this book at amazon <Link>


Giorgos is one of the founding members of the Thomson Reuters Oil Research & Forecasts (R&F) team in London and is currently leading the new Oil R&F team in Dubai. He is involved with oil flows, fundamentals research and model development. Giorgos has developed the Oil R&F's forecasting models for crude prices and oil demand. He holds a MMath in Applied Mathematics and Physical Sciences and an MSc in Renewable Energy Engineering.


OPEC OIL Flows- February 2016

● Oil Flow Methodology(by Thomson Reuters)● OPEC Exports● Export Focus

❏ Saudi Arabia❏ Iraq❏ Iran

*you may access detailed report at http://goo.gl/NAE3mL


Iran: Post Sanctions

❏ Iran Economy

❏ Upstream Oil

❏ Trade Flows

*You may access detailed report at http://goo.gl/RZaTLR


Renewable Energy- A Factor impacting Oil Price?


Casper Sønderby is Head of projects, at AH industries He leads delivery (EPCI & EPC) for the OEMs in the wind industry. In his stint of 20+ years in oil & gas industry he has worked with DONG E&P ,Semco Maritime as Manager on leading project portfolios.

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•Increasing demand •Decreasing supply of

hydrocarbons

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● Data shows, production ratio Little or no impact on oilprices

○ Looking ahead 2020 – 2025 :Increase in demand from 3rd world countries based on infastructure, grid for power suply

○ Big Picture: Growth in hydrocarbon demand will preserve price of oil


Energy consumption per inhabitant

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#oges oil price presentation dr. lynch- dr.sorin- dr.eve-giorgos-casper

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