U.S. Energy Information Administration Independent Statistics & Analysis Global Oil Geopolitics Rio Oil & Gas Conference September 17, 2012| Rio de Janeiro, Brazil Adam Sieminski Administrator

Crude oil prices react to a variety of geopolitical and economic events 2 price per barrel (real 2010 dollars, quarterly average) Low spare capacity Iraq invades Kuwait Saudis abandon swing producer role Iran-Iraq War Iranian revolution Arab Oil Embargo Asian financial crisis U.S. spare capacity exhausted Global financial collapse 9-11 attacks OPEC cuts targets 1.7 mmbpd OPEC cuts targets 4.2 mmbpd Sources: U.S. Energy Information Administration, Thomson Reuters Adam Sieminski September 17, 2012

World Oil Market 3 Adam Sieminski September 10, 2012

Economic growth has a strong impact on oil consumption 4 percent change (year-on-year) Forecast Sources: U.S. Energy Information Administration Short Term Energy Outlook, September 2012 and Thomson Reuters Adam Sieminski September 17, 2012

Non-OECD liquid fuels use is expected to surpasses almost flat OECD liquid fuels use in the near future total liquids consumption million barrels per day Projections History 2010 Other non-OECD OECD Americas OECD % 19% 35% 41 Non-OECD 46 5 Source: U.S. Energy Information Administration, Annual Energy Outlook 2012 Adam Sieminski September 17, 2012

In OECD countries, price increases have coincided with lower consumption 6 percent change (year-on-year)price per barrel (real 2010 dollars) Sources: EIA Short Term Energy Outlook, Thomson Reuters Forecast Adam Sieminski September 17, 2012

Rising oil prices held down global oil consumption growth from , despite high economic growth 7 percent change (year-on-year)price per barrel (real 2010 dollars) Sources: EIA Short Term Energy Outlook, Thomson Reuters Forecast Adam Sieminski September 17, 2012

Non-OPEC production slowed in 2011, but EIA expects stronger growth in 2012 and million barrels per day change (year-on-year) Sources: EIA Short Term Energy Outlook, Thomson Reuters Forecast Adam Sieminski September 17, 2012

Non-OPEC supply expectations were adjusted upward in after production decreased during economic downturn 9 million barrels per day annual average expectations Sources: U.S. Energy Information Administration Short Term Energy Outlook, September 2012 Note: Starting in January of each year, each line shows the expected forecast of non-OPEC supply growth for the specified calendar year, which tends to move toward the actual realized growth outcome as the year progresses. Adam Sieminski September 17, 2012 //

Estimated unplanned production disruptions among non-OPEC producers, through August 2012 thousand barrels per day Source: U.S. Energy Information Administration Availability and Price of Petroleum and Petroleum Products Produced in Countries Other Than Iran Report, August 2012 Adam Sieminski September 17,

Projected non-OPEC supply growth over the next two years, major countries change in production from previous year million barrels per day Adam Sieminski September 17, Source: U.S. Energy Information Administration Short-Term Energy Outlook, September 2012

OPEC production often acts to balance the oil market. Cuts in OPEC production targets tend to lead to price increases. 12 Sources: U.S. Energy Information Administration, Thomson Reuters Adam Sieminski September 17, 2012 million barrels per day change (year-on-year)price per barrel (real 2010 dollars)

OPEC surplus crude oil production capacity Adam Sieminski September 17, million barrels per day Source: U.S. Energy Information Administration Short-Term Energy Outlook, September 2012 forecast

World Crude Oil Supply and Demand Balance 14 Adam Sieminski September 10, 2012 million barrels per day Source: U.S. Energy Information Administration Short-Term Energy Outlook, September 2012 Forecast //

U.S. Oil Market 15 Adam Sieminski September 10, 2012

Domestic production of shale gas and tight oil has grown dramatically over the past few years 16 tight oil production for select plays million barrels of oil per day Source: HPDI, Texas RRC, North Dakota department of mineral resources, and EIA, through March, shale gas production (dry) billion cubic feet per day Adam Sieminski September 17, 2012

U.S. liquid fuels production 17 Total liquids fuels production million barrels per day (line chart) Change from prior year million barrels per day (column chart) Adam Sieminski September 17, 2012 Source: U.S. Energy Information Administration Short-Term Energy Outlook, September 2012

Composition and volume of U.S. crude oil imports is shifting Adam Sieminski September 10, Crude oil imports million barrels per day Source: U.S. Energy Information Administration through June 2012

U.S. commerical crude inventories outside of the mid-continent (PADD 2) are within the normal range Adam Sieminski September 17, million barrels Source: U.S. Energy Information Administration Note: Inventories include only commercial stocks of crude oil in Petroleum Administration for Defense Districts other than PADD 2

U.S. liquids fuel consumption is flattening 20 Total liquids fuels consumption million barrels per day (line chart) Change from prior year million barrels per day (column chart) Adam Sieminski September 17, 2012 Source: U.S. Energy Information Administration Short-Term Energy Outlook, September 2012

U.S. dependence on imported petroleum declines …moves even lower in various “side case” scenarios U.S. liquid fuel supply million barrels per day ProjectionsHistory 2010 Consumption Domestic supply Net petroleum imports 49% 36% 60% 2005 Source: U.S. Energy Information Administration, Annual Energy Outlook % Extended Policies High TRR Adam Sieminski September 17,

Composition of U.S. liquid fuels consumption – implication for Brazil U.S. liquid fuels consumption million barrels per day Source: U. S. Energy Information Administration, Annual Energy Outlook 2012 EURTRR % 5% 36% 10% Natural gas plant liquids Other non- petroleum supply Biofuels Net petroleum imports Domestic including imports EUR TRREUR supply Reference 22 Adam Sieminski September 17, 2012

For more information 23 U.S. Energy Information Administration home page | Short-Term Energy Outlook | Annual Energy Outlook | International Energy Outlook | Monthly Energy Review | EIA Information Center Our average response time is within three business days. (202) hour automated information line about EIA and frequently asked questions. Adam Sieminski September 17, 2012