Retour à la moyenne des Prix du Pétrole. Comment? Quelles conséquences?

Transcription

1 Retour à la moyenne des Prix du Pétrole Comment? Quelles conséquences? Paris 12 avril 2016 Frederic Baule

2 Historically, today s Oil Prices are not low Source : BP Statistical Review of World Energy 2015 BP p.l.c Prices reverting to historical average: Why Now? And What s Next?

3 International Markets: a dominant role in Oil Price Formation International Market International Markets Storage Storage Producer Transport Refiner Transport Retailer Consumer Crude Oil Refined Products

4 Price Formation : an on going adaptation to new market environments 1960 OPEC 1975/1985 Long Term Contracts Fixed Prices 1985/1986 Price Formulae Indexation on Product Prices 2000 / 2003 OPEC stopped referring to a Fixed Price level Oil Market Financialization 1980 s Spot Cargoes Fixed Prices 1987 Price Formulae with a Crude Oil Price Indexation 2014 OPEC OPEC / Saudi Arabia decide no longer to balance the Market

5 A structural «Decoupling» of the Oil Supply Chain Refiner Midstream Function: Trading & Risk Management International Market International Market International Market Crude Oil Derivatives Products Producer Retailer Consumer

6 Price Formulae make reference to Price Benchmarks + Price Differential Russian Oil / Brent Quality Logistics Financing Price of a barrel Of Russian Oil Price of a barrel of Brent Physical Oil Cargoes are not negotiated at a fixed price

7 Markets for Oil Price Benchmarks = Financial Markets A market for physical Oil. Market For physical Brent Cargoes Spot Market For Physical Brent Cargoes Forward Futures Market For Brent (ICE) OTC Derivatives Market For Brent Russian Oil Cargo pricing by reference to «paper» Markets

8 Industrial & Commercial Companies became Price Takers 500, ,000 Nombre de Contrats négociés par jour 400, , , , , ,000 Contracts of Gasoil traded daily on ICE Futures Markets 1 contract = 100 Tons 100,000 50,000 0 Products sold by Total M&S In a month, worldwide 2015 average

9 Given what happened in 2008 Policy Makers wondered : What s next?

10 International Regulatory Framework: FSB / IOSCO Oil Market Task Force IEA IEF OPEC Regulators Regulators were asked to address Oil Financial Markets

11 Meanwhile Market Operators revisited the Spot / Forward Price Relationship / 100 Forward : OK! But why 80 Spot? % p.a WTI 1st maturity Nymex sttlement price USD / Bbl

12 Does it Make Sense?

13 90 $ : assumed to be the new Paradigm

14 With Complacency Forward : not 125! % p.a % p.a

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16 December 31, 2014

17 December 31, 2015

18 A Market still trying to guess p.a.? what is the marginal cost of production for US Shale Oil.

19 And how long it will take to deplete inventories given Producers meeting in Doha on April 17. April 5

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21 Consequences Financial Times 1.5/2 c 3 4 c 5 6 c

22 Oil Prices do matter! And so do the five coming years!

23 Consequences : a Market Perspective Refiner Crude Oil Derivatives Products Producer Retailer Consumer

24 Traders have their Views: on Oil and Shares for example In a classic sign that investors are truly worried, the world of one trade is back. Bank of America Merrill Lynch points out that on an intraday basis, oil s correlation to credit and stocks is running at well over 90 per cent. This becomes self-fulfilling very quickly once egg-headed computer programmers get the joke and start writing trading algorithms to capitalise on the relationship. Katie Martin FT feb 2016

25 Short Term Business Opportunities & Windfall Profits for the Middlemen Refiner Crude Oil Derivatives Products

26 Impact : More Upstream than Downstream Retailer Consumer Producer

27 An Opportunity to refocus Fossil Fuel Subsidies on targeted Populations Source : World Bank - The great plunge in oil prices March 2015

28 Upstream Warning Signal : Big Oil Dividends BCG Killing the Complexity Monster in Exploration Production - January 2015

29 US Investors in Upstream & Service Cies : Being hurt Industry Consolidation / Restructuring on its Way.

30 Knock-on Effect on National Oil Companies

31 and on Producing Countries Source : S.Nachet Association des Economistes de l Energie Février 2016

32 access to Financial Markets. Nigeria s dollar crunch adds to fuel crisis Refinery woes, currency controls and militant attacks combine to prolong acute shortage April 7 Nigeria considers plan to sell stake in state oil giant Fast FT April 8, 2016 Nigeria seeks cheapest possible money to finance infrastructure Lagos looks to plug budget deficit and reduce economy s dependence on oil FT April 10

33 Who will be the next Oil Risk Takers in a World where Climate matters? Exxon faces calls for climate change stress test Investors call on oil major to assess impact on its business of climate change policies Dozens of investors are backing the call for ExxonMobil, the US oil group, to stress test the potential impact on its business of policies to address the threat of climate change. Shareholders have submitted proposals for the annual meetings of Exxon and eight other US energy companies, recommending that they analyse the financial risks they face if governments attempt to limit the increase in global temperatures to 2C, which was the objective agreed at the Paris climate talks at the end of last year. Calpers, the California state retirement fund that had $301bn under management as of last June, has registered with the Securities and Exchange Commission, the US regulator, to be able to lobby other investors in support of the proposal at Exxon. 12 avril

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35 Producing Countries 04 April Mexico's proven oil and gas reserves fell by 21% in 2015 According to Mexico's oil regulator National Hydrocarbon Commission (CNH), proven oil and gas reserves in Mexico fell by 21% in Proven (1P) reserves, covering oil and gas fields believed to have a 90% chance of being extracted with existing technologies, declined from just over 13 Gboe in 2014 to 10.2 Gboe in Proven reserves of crude oil fell by 21% to 7 Gbl, while gas reserves fell by more than 17% to 12.7 bcf. This decline in hydrocarbon reserves is related to collapsing crude oil prices that hindered investments by Mexican state-owned oil and gas company Pemex. In early 2016, the group announced that it would postpone billions of dollars worth of projects, including exploration projects. Angola becomes latest oil producer seeking IMF bailout Fast FT April 6, 2016 Fitch downgrades Saudi Arabia; outlook still negative Fast FT April 12, 2016 Enerdata

36 Réserves source : BP Statistical review 2015

37 Distribution of proved coal reserves: 1994, 2004 and 2014 Percentage Source: World Energy Resources 2013 Survey, World Energy Council. BP Statistical Review of World Energy 2015 BP p.l.c. 2015

38 Distribution of proved gas reserves: 1994, 2004 and 2014 Percentage BP Statistical Review of World Energy 2015 BP p.l.c. 2015

39 Distribution of proved oil reserves: 1994, 2004 and 2014 Percentage BP Statistical Review of World Energy 2015 BP p.l.c. 2015

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