British Petroleum’s energy outlook, for the next 20 years, which was released on Wednesday, February 17, sees record demand for the OPEC oil producers crude, including Nigeria, as shale production reduces.
Oil prices have dropped some 50 per cent in the past year, hitting the currencies and stock markets of producers like Nigeria, which depend on the commodity for 70 per cent of its budget and 90 per cent of foreign earnings.
According to the recent report, growth in US shale oil is expected to drop in coming years, indicating high decline rates.
BP, in its report said in part: “This pressure on OPEC is likely to persist in the early years of the Outlook… Further out, as tight oil supply growth slows and demand strengthens, the call on OPEC crude begins to increase, exceeding the historical high (32 Mb/d in 2007) by 2030.”
“OPEC’s market share by the end of the Outlook is around 40 percent, similar to its average of the past 20 years.” US oil production growth in 2014 (roughly 1.5 Mb/d) was the largest in US history, driven by tight oil and NGLs (natural gas liquids).
The strength of U.S shale oil production, which had weakened the demand for OPEC producers’ crude is seen to be meeting a gradual end.