Que reste t’il de l’OPEP Olivier APPERT Senior adviser Ifri - Centre for Energy President of the French Energy Council Université Paris Dauphine 8 mars 2016

2 Production costs

A financial challenge for producing countries Pump price for diesel fuel (US$ per liter) Pump price for gasoline (US$ per liter) Source: World Bank Indicators Energy subsidies weigh on fiscal balances Source: IMF, Deutsche Bank Fiscal breakeven price Source: APICORP

Uncertainties on future production of several OPEC members Crude oil production Million barrels/day Source: BP * data for 2015 are taken from IEA OMR (September 2015)

Shifting alliances in the Middle East? Russia, Saudi Arabia, Iran, US… Les conflits au Moyen-Orient, Source: Ifri, Ramsès 2016

How will the Oil cost curve evolve? 6

LTO breakeven price is decreasing while conventional oil cost is increasing 7

US operators have responded to the current environment by slashing Capex 8

Monthly crude oil production and rig count in DPR regions 9

Initial production rates in tight oil formations continue to rise 10

A new paradigm for the Oil market The Seven Sisters OPEC ? The US swing producer

A cyclical market Primary energy demand growth and fuel type IEA – New Policies Scenarios Source: IEA- WEO Years Brent price cycles (Max/min/max) 100=initial cotation 09/ /2004

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