US oil production forecasts revised higher
US oil production forecasts revised higher
Crude production is expected to reach 9.53 million barrels per day (bpd) in December 2017, according to the latest forecasts from the US Energy Information Administration (EIA).
Forecast output for December 2017 has been revised up from 8.29 million bpd when the agency prepared its predictions in March last year. The forecasts are contained in the “Short-Term Energy Outlook” EIA publishes every month. Forecast output has been revised higher every month since September 2016.
Revisions are concentrated in output from the lower 48 states, excluding federal waters in the Gulf of Mexico, so they are mostly about shale output, rather than offshore fields and Alaska.
The EIA has revised expected output at the end of 2017 from the lower 48 excluding the Gulf of Mexico up by 1.4 million bpd since March 2016.
Upward revisions stem from a combination of higher oil prices, an increased number of rigs drilling and improvements in methodology. Operators have added many more rigs and produced more oil than the agency was forecasting just six months ago.
Oil prices ended up being $5 per barrel higher in the fourth quarter of 2016 than the agency forecast back in August. Prices in the first quarter of 2017 have so far averaged about $7 higher.
Higher prices have contributed to more drilling, particularly in the Permian Basin of western Texas and eastern New Mexico, raising the current rig count and actual production the forecast uses as a baseline.
Higher rig counts have also revealed new information about the price levels at which operators in certain areas can increase production, which have filtered through to the models that the agency uses.
In addition to the price impact, the agency has made a number of improvements to its methodology.
According to the agency, these changes have been phased in over several months and contributed to the upward drift in the forecasts.
EIA has shifted from basin-level to well-level forecasts and improved its understanding of the time lags between price changes and when operators add drilling rigs.
The agency has also tweaked the model it uses to allow for more interplay between oil and gas prices, allowing the model to select whether drillers will focus on oil or gas depending on price differentials.
Price differentials can be important in shale plays such as Eagle Ford, which have both liquids-rich and gas-rich areas.
Finally, the agency has updated its assumptions about improvements in drilling efficiency, allowing efficiency to change more quickly.
As a result, US production is now expected to pass its previous peak in March 2018 and to reach 10 million bpd by the end of 2018.
• John Kemp is a Reuters market analyst. The views expressed are his own.
Saudi Arabia has lion’s share of regional philanthropy
- Kingdom is home to three quarters of region's foundations
- Combined asets of global foundations is $1.5 trillion
Nearly three quarters of philanthropic foundations in the Middle East are concentrated in Saudi Arabia, according to a new report.
The study, conducted by researchers at Harvard Kennedy School’s Hauser Institute with funding from Swiss bank UBS, also found that resources were highly concentrated in certain areas with education the most popular area for investment globally.
That trend was best illustrated in the Kingdom, where education ranked first among the target areas of local foundations.
While the combined assets of the world’s foundations are estimated at close to $1.5 trillion, half have no paid staff and small budgets of under $1 million. In fact, 90 percent of identified foundations have assets of less than $10 million, according to the Global Philanthropy Report.
Developed over three years with inputs from twenty research teams across nineteen countries and Hong Kong, the report highlights the magnitude of global philanthropic investment.
A rapidly growing number of philanthropists are establishing foundations and institutions to focus, practice, and amplify these investments, said the report.
In recent years, philanthropy has witnessed a major shift. Wealthy individuals, families, and corporations are looking to give more, to give more strategically, and to increase the impact of their social investments.
Organizations such as the Bill and Melinda Gates Foundation have become increasingly high profile — but at the same time, some governments, including India and China, have sought to limit the spread of cross-border philanthropy in certain sectors.
As the world is falling well short of raising the $ 5-7 trillion of annual investment needed to achieve the UN’s Sustainable Development Goals, UBS sees the report findings as a call for philanthropists to work together to scale their impact.
Understanding this need for collaboration, UBS has established a global community where philanthropists can work together to drive sustainable impact.
Established in 2015 and with over 400 members, the Global Philanthropists Community hosted by UBS is the world’s largest private network exclusively for philanthropists and social investors, facilitating collaboration and sharing of best practices.
Josef Stadler, head of ultra high net worth wealth, UBS Global Management, said: “This report takes a much-needed step toward understanding global philanthropy so that, collectively, we might shape a more strategic and collaborative future, with philanthropists leading the way toward solving the great challenges of our time.”
This week Saudi Arabia said it would provide an additional $100 million of humanitarian aid in Syria, through the King Salman Humanitarian Aid and Relief Center.
The UAE also this week said it had contributed $192 million to a housing project in Afghanistan through the Abu Dhabi Fund for Development.