The reasons for the positive demand revisions come from every region of the global oil market, with stronger economic activity the main reason for the more optimistic outlook.
Few, if any, shale oil producers are profitable in the current price environment. But unlike previous oil price collapses, oil companies have access to new lines of credit which are helping to keep production high.
Hedge funds have taken hits from lackluster equities and a big shake-up in commodities. The string of fund closures could be a harbinger of deeper structural issues in the economy.
Despite the bleak picture for producers, oil sands output in Alberta is still expected to grow by .8 mbd between now and 2020.
Crescent Petroleum’s CEO Majid Jafar, in an exclusive interview with The Fuse, said that demand issues had a bigger impact than supply in causing oil prices to fall in the past year, and decisions made now regarding transportation policy can bring about major changes 10-20 years down the road.