for Barrels at Risk
A recent study [indicates that] for every million barrels of oil taken off the market, the world oil price will rise by about $5 per barrel, given a baseline oil price of around $60 per barrel. This suggests…a large-scale disruption in Saudi Arabia could cause an upswing of 50 percent or more, and that a catastrophic regional disruption could result in the doubling of oil prices.” A 100 percent increase in oil prices could reduce U.S. GDP by around 5 percent.
Historically high oil output obscures the fact that OPEC is also experiencing some of its worst-ever unplanned outages. Combined, the volumes lost to violent conflict, political disputes and other setbacks add up to almost 3 mbd.
As of June, Nigeria had lost 500,000 to 600,000 barrels per day of oil production, vaporizing about $30 million of daily revenues for the country. The Nigerian government had already seen its oil revenues cut in half by the collapse of oil prices, but the loss of a substantial portion of its production has pushed the country into a state of crisis.
As Canadian wildfires have failed to cause lasting damage to tar sands extraction facilities, oil markets remain calm despite the size of the disruption.
Unlike its activities in Iraq and Syria, ISIS is focused on destroying Libya's oil sector rather than profiting from it—at least for now.
Worker concerns about privatization of Brazil's oil assets is driving a massive strike, with the potential to cause a meaningful production disruption.