Peak-oil enthusiasts and skeptics alike will find much to chew on in this page-one piece from today’s Wall Street Journal.
By all accounts, China’s explosive energy-demand growth over the past several years has strained the ability of OPEC and other oil producers to keep up. Now, the Journal claims, that pressure shows signs of easing:
This year, China is on track to account for about 16% of the world’s new oil consumption, little more than half last year’s share. The Centre for Global Energy Studies estimates that Chinese demand will rise by about 230,000 barrels of oil a day this year — a large increase, but a far cry from the 860,000-barrel-a-day jump of 2004 and a much more manageable pace for global suppliers.
The article also features the spectacle of a big-time oil exec engaging in a bit of what’s known on Wall Street as “jawboning” — trying to influence the market (in this case talking it down) with mere words. The Journal reports:
Though most market watchers were caught off guard by last year’s steep run-up in China’s oil demand, [Exxon Mobil CEO Lee] Raymond said that its consumption growth has been generally in line with industry expectations. “Speculation” accounts for about $20 of the current per-barrel price of oil, Mr. Raymond estimated. “The fundamentals” of supply and demand, he said, “support something like $35 or $40.” The Exxon chief said that, in about a decade, it will be likelier that oil prices will be below $35 than they will be to stay at today’s level of about $60 a barrel. [Emphasis added.]
Might outrage over last quarter’s startling profits, as well as the Congressional price-gouging hearings, have influenced Raymond’s desire to describe a frothy, puffed-up oil market?