US Sees Huge Energy Opportunity In Europe
If 2015 is anything like 2014 we can expect a wild ride. Oil price volatility – including its downward trend – will linger well into the first and second quarters as global production persists and key conflicts in Eastern Europe and the Middle East show no end. For its part, the United States is better positioned than most – the US is poised to carry the global economy in 2015 with projected GDP growth of 3.1 percent. However, converting this potential into meaningful energy trade and/or soft power is another matter altogether and 2015 offers limited opportunities.
US production has shown no signs of a significant slowdown and the Energy Information Administration predicts growth in 2015 – approximately 700,000 barrels per day. Despite the collapse, prices remain high enough to support the most vital development drilling activity in the Bakken, Eagle Ford, and Permian Basins. The rig count is declining, but data from the 2008-09 recession suggests a drop in production will not be so dramatic.
Perhaps in anticipation of greater volumes, the Obama administration and the Department of Commerce clarified existing regulations and opened the door for increased US exports last week – up to one million barrels per day (mbpd) of ultra-light crude oil. The exports will expose producers to more lucrative markets abroad and may further narrow the price spread between Brent and WTI. But who’s buying?
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