|
April 2004 |
Wellhead gas prices in the United States were above $5 per Mcf and climbing. |
________________________________
What everyone else said:
Numerous projects were proposed for importing liquefied natural gas (LNG) into the United States.
What GL&L said:
The “second coming” of LNG would have the same result as the attempts in the 1980s for the same reason – declining demand for natural gas.
What
happened:
Natural gas consumption declined by 1.7% in 2005 and again by 1.6% in 2006.
|
|
March 2003 |
West Texas Intermediate was ranging between $27 and $38 per barrel. |
________________________________
What everyone else said:
The anticipated invasion of Iraq would be brief and one result would be lower oil prices.
What GL&L said: The invasion would lead to a protracted guerrilla war and oil prices above $50 per barrel.
What happened: Prices began rising, initially exceeding $50 per barrel in October 2004.
|
|
February 2002 |
Crude and condensate production in Eastern Europe averaged 9.61 million barrels per day |
________________________________
What everyone else said:
Production in Eastern Europe would increase indefinitely.
What
GL&L said:
Increased Russian production was based upon exploitation, but exploration in around the Caspian Sea was disappointing. Production could peak as early as 2005.
What
happened:
Oil production in Eastern Europe reached 11.8 million barrels per day in 2007, and if 2008 continues its current trend, production will fall by 300 thousand barrels per day.
|
|
March 2001 |
Oil production in Mexico averaged 3.39 million barrels per day |
________________________________
What everyone else said:
Production in Mexico could be sustained indefinitely.
What
GL&L said: A peak in Mexican production is imminent, perhaps in 2003.
What
happened: Mexican oil production began falling after reaching 3.62 million barrels per day in 2004.
|
|
March 2001 |
Chinese crude production averaged 3.2 million barrels per day. |
________________________________
What everyone else said:
Production in China could increase indefinitely.
What
GL&L said:
While increased production is expected in the short term, Chinese crude should begin to decline in 2006.
What happened: China’s crude production reached 3.4 million barrels per day in 2007, before starting to decrease.
|
|
June 1999 |
Gas production in the Lower 48 states was 19.78 Tcf |
________________________________
What everyone else said:
The National Petroleum Council, in its 1999 report to the Department of Energy, stated that “US production is projected to increase from 19 Tcf in 1998 to 25 Tcf in 2010, and could approach 27 Tcf
in 2015.”
What GL&L said: A peak in Lower 48 state gas production is imminent.
What
happened:
Gas production in the Lower 48 states peaked in 2001 at 20.84 Tcf and began its irreversible decline.
|
|
April,
1999 |
OPEC met in March, 1999 and reduced quotas to 25.5 mmbd. |
________________________________
What everyone else said:
The third round of production cuts might get prices back
up to $18 to $20 per barrel by year-end.
What GL&L said: Because the OPEC ministers
were confused about the numbers - including belief in
“missing barrels” - they made a radical adjustment.
If the new agreement holds past the meeting on September
22, the price of WTI can be expected to reach $30 per
barrel by the end of 1999.
What
happened:
WTI was $30.12 per barrel at the end of February, 2000.
|
|
October,
1998 |
Low
prices had the industry in a panic. |
________________________________
What everyone else said:
Oil prices will remain depressed for a long time.
What
GL&L said:
All the fundamentals were in place for a big jump in oil
prices within the next six months.
What
happened: Oil
prices began a dramatic recovery to more than $30 per
barrel after the OPEC meeting in March, 1999.
|
|
August,
1998 |
OPEC
met in June, 1998 and reduced quotas to 26.5 mmbd. Prices
continued to decline in the second half of 1998. |
________________________________
What everyone else said:
The “production cuts” are real and prices will
recover to $18 to $20 per barrel.
What GL&L said: The real cuts in production
are minimal. Prices will continue to decline.
What
happened:
At the end of February, 1999 WTI was $12.27 per barrel.
|
|
January,
1998 |
OPEC
met in Jakarta, Indonesia in November, 1997 and raised
quotas from 25.0 mmbd to 27.5 mmbd. This was seen as a
non-event. |
________________________________
What everyone else said:
Increasing quotas will have little effect because OPEC
production of crude oil was already more than 27 mmbd
during 1997.
What
GL&L said:
OPEC production of crude oil in 1997 was only 26 mmbd.
The new quotas will drive WTI down to $17 per barrel.
What happened: At the
end of October, 1997 WTI was $21.10 per barrel. At the
end of March, 1998 it was $15.72 per barrel.
|
|
April,
1996 |
Enthusiasm
for spending was increasing among E&P
companies. As 1996 began, the price of West Texas Intermediate
(WTI) was $19.54 per barrel. By the end of 1996 it was
$25.76. |
________________________________
What everyone else said:
They said nothing. They didn’t warn anyone about the
potential relief from Iraq.
What
GL&L said: Iraq
will get relief from the embargo following the November
U.S. elections because it can prevent a large increase
in prices for crude oil.
What
happened: Iraq began exporting under the
“oil for food” program in December, 1996.
For practical purposes, the oil embargo ended in June,
1998.
|
|
June,
1993 |
In
a statement related to the National Petroleum Council,
the Department of Energy (DOE) wanted to develop “public
and private sector confidence that natural gas can make
a greater contribution to the energy security and environmental
enhancement of our nation.” |
________________________________
What everyone else said:
In their 1992 report on The Potential For Natural
Gas in the United States, the National Petroleum Council
said that natural gas will be produced and delivered in
volumes sufficient to meet expanding market needs at competitive
prices -25 Tcf of consumption in 2010.
What
GL&L said:
The National Petroleum Council report was badly flawed.
The long-term outlook is for declines in production and
consumption and prices of $4.00 to $5.00 per MMBTU.
What
happened:
In early 2000, production of natural gas declined and
prices were consistently more than $4.00 per MMBTU.
|
|
February,
1986 |
The
“gas bubble” - an excess of deliverability over
market demand - resulted in lower prices and massive problems
with take-or-pay contracts. |
________________________________
What everyone else said:
The gas bubble will end in 12 to 18 months.
What GL&L said: The gas bubble will
persist until 1993.
What happened: Market demand finally matched
deliverability in late 1992. The average wellhead price
was $1.93 per MMBTU in 1993 versus $1.35 per MMBTU in
1991.
|
|
October,
1980 |
Arab
Light had risen from $12.70 per barrel in 1978 to more
than $30 a barrel. |
________________________________
What everyone else said:
Oil prices will continue to increase, perhaps to as
much as $100 per barrel.
What GL&L said:
Oil will be selling for $15 per barrel by 1985, half of
its 1980 price.
What
happened:
Prices
began falling after the October, 1985 OPEC meeting. In
1986 the average price for Arab Light was at $14.04 per
barrel.
|
