Global Crude Oil Prices: Why Volatility Is Likely To Endure

Soaring U.S. oil production should be enough to allow consumers withstand most potential supply shocks, the International Energy Agency (IEA) said on Wednesday, as it cut estimates for global oil demand. “The oil-producing world today is in the midst of a onceinageneration transition of farreaching consequences,” the IEA, which coordinates the energy policies of major consuming nations, said in its monthly oil market report.

The U.S. shale boom will send “shockwaves” through the global oil trade over the next five years, benefiting the nation’s refiners and displacing OPEC as the driver of supply growth, the IEA said.

The International Energy Agency (IEA) has the latest version of its Medium-Term Oil Market Report, and it pays note to the supply shock emanating from North America, and that it could mean markets.

Dennis U. Atuanya submits: The current wave of unrest blowing across the Middle East , North Africa (MENA) region and the associated uptick in crude oil prices have raised concerns about another (and possibly sustained) global crude oil price shock — the region currently holds about 60% and 45% of global crude oil and natural gas reserves respectively and accounted for about 45% of global oil exports in 2009.

LONDON/OSLO — European authorities have raided offices of oil majors Shell, BP and Statoil as part of a probe into suspected manipulation of oil prices, one of the biggest cross-border actions since the Libor rigging scandal. Authorities have sharply raised scrutiny of financial benchmarks around the world since slapping large fines on some of the world’s biggest banks for rigging two interest rate benchmarks — Libor and Euribor.

Slow economic growth and ample supplies are expected to keep a lid on oil next year with crude prices gradually slipping lower. But analysts polled by Reuters say a price crash is unlikely and geopolitical concerns should help support the market. Reuters monthly survey of 26 analysts forecast North Sea Brent crude oil will average $108 per barrel in 2013, down from an average of $111.71 so far this year. Brent prices are projected to fall further to an average of $105.90 in 2014, the poll showed.

In the high-growth scenario solar will likely emerge as the dominant energy source, rising currently from its position as the 13th largest energy source worldwide, to displacing oil, gas and coal. Solar could account for 37% of all energy source by 2100 Solar could overtake oil as the world’s dominant energy source by 2060 in one scenario envisioned by Royal Dutch Shell.