The World’s Most Important Oil Consumers And Producers

Following last week’s release of the BP Statistical Review of World Energy 2020, I began to review and analyze the data. Today I take a deeper dive into the numbers on petroleum. Oil accounts for a third of the world’s energy consumption. That is the greatest share for any category of energy. In 2019, the world consumed a record 98.3 million barrels per day (BPD) of oil. This was nearly 1 million BPD higher than consumption in 2018, and marked the 10th consecutive record for global oil consumption.

Over the past 35 years, global oil consumption has risen by 39 million BPD, an average increase of 1.1 million BPD each year. Last year’s rise fell just short of that average.

In recent years, BP has begun to provide more granularity in the Review. In previous years, the oil consumption category included biofuels. Now, they have split biofuels into a separate category, so the consumption numbers above are for just oil and derivatives of natural gas and coal (e.g., synthetic oil).

The U.S. continues to lead all countries in the consumption of oil, but China has had the fastest consumption growth for several years. Below are the Top 10 global consumers of oil for 2019.

Related: Saudi Arabia Eyes Total Dominance In Oil And Gas Oil consumption fell in most developed countries and rose in most developing countries. A notable exception was Germany. Although consumption in OECD countries fell by 0.6% and consumption across Europe was down 0.3%, Germany bucked the trend and saw its consumption grow by 0.9%.

The biggest percentage increase in oil consumption was in Iran, which was the world’s 11th largest consumer. Demand there jumped by 10.0%. Iran was the only country in the world with a double-digit percentage increase in demand.

In contrast, double-digit decreases in oil demand were seen in Iceland (-12.7%), Venezuela (-11.6%), and Pakistan (-10.5%).

BP also expanded the level of detail around oil production statistics. Previously, natural gas liquids, or NGLs, were lumped into oil production. Although some NGLs do end up in the fuel supply, others are feedstock to the petrochemical industry. This year BP reported a new category for oil production that is simply “crude oil and condensate”, which is consistent with the way the Energy Information Administration (EIA) reports U.S. oil production.

Based on the change, U.S. oil production numbers for previous years were revised downward by several million barrels a day. Oil production in 2018, for example, had been reported as 15.3 million BPD. But under the new category, 2018 oil production was reported as 11.0 million BPD.

However, because of the revisions to previous years, U.S. production — which had led Russia and Saudi Arabia for years — dropped below the production of one or both countries for years prior to 2019. Under the new category, in 2019 U.S. oil production was the highest in the world for the first time this century.

$30 Oil Won’t Keep U.S. Shale From Setting Production Record

Despite the low oil prices that brought on by the combination of the coronavirus pandemic’s migration to the United States and the oil price war between Russia and Saudi Arabia, US shale producers will together hit a new record output next month, according to the Energy Information Administration (EIA).

Today, the EIA predicted that OPEC’s shift to maintain its market share will cause global inventories to increase further, and prices to fall further.

And the US shale will do its part to contribute to a global increase.

Oil production in the seven most prolific shale basins will hit a new high of 9.075 million barrels per day in April, an increase of 180,000 barrels per day. The largest increase will come from producers in the Permian basin, adding 38,000 bpd of the 180,000-­­bpd total increase, reaching 4.79 million bpd.

All other basins are expected to see a decrease in oil production next month.

Meanwhile, gas production in those seven plays is expected to decrease, the EIA said, by 188 million cubic feet per day.

Russia and Saudi Arabia are waging an oil price war, with Saudi Arabia ramping up production to more than 12 million bpd, and has booked VLCCs to carry more oil to its customers for next month. Both Russia and Saudi Arabia have insisted that they can comfortably withstand these lower oil prices. Analysts aren’t sure of those optimistic statements, nor that US shale will be able to keep its debt-laden head above water in a sub-$30 WTI environment.

US shale producers are now facing a more direct coronavirus challenge as lawmakers in the States work to shutdown nonessential businesses and activities in an effort to stop the coronavirus from spreading. In Texas, home to part of the Permian basin, schools have been closed and could remain closed for the remainder of the academic year, and Dallas and San Antonio have banned large gatherings.

In New Mexico, housing the other part of the Permian, Governor Grisham ordered state employees to work from home, and called on other businesses to follow this as well.

Other states have closed bars, restaurants and movie theaters, and the California Bay area has ordered residents to remain at home for three weeks.

By Julianne Geiger for Oilprice.com