Category Archives: Oil Marketing
In risk-based management, one tries to anticipate the risk. The risk is either a threat or an opportunity. The issues of today are the risks of the past. The risks of the future are driven by the issues and problems of today. How the issues are addressed today will decide what happen in the future. These are fundamentals of risk and risk-based management. The risky future of oil points to the events that threaten it and the opportunities that come close behind ( Frago, R., 2015.Risk-based Management in the World of Threats and Opportunities: A Project Controls Perspective).
No one expert knows exactly how much oil out there exceeds the global volumetric demand but all seem to agree that the entire world is drowning in it. The Gulf countries, foremost Saudi Arabia are reportedly pumping at almost maximum capacity without blinking an eye.
There are now more than three billion barrels of excess supply in world oil markets, according to the International Energy Agency last November 2015. It its latest monthly report, the IEA said this “massive cushion” of excess supply has grown as oil prices have fallen to a new normal of around $50 billion barrels a day (The Telegraph, 2015). We can all extrapolate what is the current figure as of today and we won’t be dead wrong.
With Iran back on play, it won’t be long before the Iranians fully open their discharge valve occupying whatever space is left to take. This Saudis are doing all they can to protect and even grow market shares. The object is to prevent arch rival Iran from surging back with vengeance. It means that whatever good things the last twelve months retreat shelving drilling, exploration, and billions worth of projects, truth of the matter is, it might not be enough. Continue reading