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| The US is still the worlds largest consumer.. but we are a flea on the back of a camel compared to the growth from Asia as the US is a mature market... whereas all the growth is overseas.
It basically comes down to how quickly everything comes back online.. when the worlds economy shut down..Crude oil went negative.. When we go back to “normal”.. whatever that becomes.. the blastoff in demand will potentially be just as violent as the shutdown was.. only in the other direction. US demand may only go back to.. 90.. 93.. 95%.. 98% idk.. but Asia will go back to growing at.. 105%..110%..120% vs the ??? 140% or more it was doing..
https://www.spglobal.com/platts/en/market-insights/blogs/oil/091720-...
So it’s gonna be a bumpy restart.. probably.. unless we fall into an extended recession.
https://www.businessinsider.com/oil-demand-rise-next-three-years-bef...
“Demand for oil worldwide is on course for its swiftest pace of growth in four decades but demand also looks set to peak in 2030 as more people buy electric vehicles, Bank of America analysts projected.
The COVID-19 pandemic stoked a collapse in demand by nearly 9 million barrels of oil a day in 2020, but a pickup in transportation needs is primed to accelerate consumption starting this year through 2023.
"Should our expectations play out, this would be the fastest 3- year pace of growth since the 1970s in absolute volumes," said strategists led by Francisco Blanch, head of global commodities research at BofA Merrill Lynch, in a note published Friday.
Demand is poised to be "front-loaded" in 2021, with an increase by 5.3 million barrels a day, drifting back to 2.8 million barrels a day in 2022 and rounding off with a rise of 1.4 million barrels a day in 2023.“
Wow just think of that... losing 9 myn bbls per day took nearby crude from $55’ish to -$40 ish.. the restart.. probably should be a little more orderly.. maybe slower than the SnapBack some were calling for.. but.. slap $90 a bbl on to $50.. takes you to $140’ish.. If we flip the switch.. less if it’s more gradual..
In the US we’ve got maybe a myn bbls or two of spare capacity.. Opec is firing back up.. So maybe the first.. 4 to 5 myn comes back online easily.. after that.. start the drilling rigs.. with the price which it takes to do that..
Lost 9 myn bbls.. restart needs 9.5 myn.. “off“ to “On” How quickly can the world find 9.5 myn bbls per day.. the US.. the worlds largest crude oil producer eased back from 13.1.. to 9.5.. to 11.1
It “could” be a wild ride.. similar to.. 2009 to 2012 restart.. which was modest.
Maybe $100 crude holds it?
Maybe it doesn’t?
Idk
Does world growth snap back?
Gradually return?
Or struggle to regain pre covid growth rates?
9.5 myn bbls per day.. almost the entire US production.. that’s “a lot” of slack demand..
Answer that.. then you can start to figure out crude demand.. and prices.
Edited by JonSCKs 2/13/2021 21:35
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Oil bull Market?
