IEA sees $200 per barrel oil
Even as oil is falling to the lowest prices in nearly two years, the Paris-based International Energy Agency is warning that the "era of cheap oil is over," The Guardian reported.
The IEA is predicting that soon the global price of crude oil will be back up around $100 per barrel and will only move higher as reserves decline.
Oil in the North Sea, the IEA predicted, could decline by 2030, leading to double oil prices.
More than $26 trillion of new investment will be needed over the next 20 years to ensure the world will have enough energy to meet demand, the IEA's most recent report said.
IEA officials said the current drop in oil prices is due to the economy, but dwindling reserves will create a more permanent pricing effect.
According to IEA predictions, oil will increase to more than $100 per barrel by 2015 and then will double by 2030.
While the IEA does not say the planet has reached peak oil yet, officials acknowledge that it will be increasingly difficult to find new oil resources. They predict conventional oil production will increase by only 5 million barrels a day by 2030.
The oil that is remaining is under tight control by a select few, particularly the Organization of Petroleum Exporting Countries.
Canada's oil and gas drilling will decrease
According to a recent report from the Petroleum Services Association of Canada, there will be 650 fewer oil and gas wells drilled in the nation in 2009 compared with 2008.
Alberta's production will be hit the hardest, according to the report, as higher royalties on top of the ailing economy are pushing new investment companies away, the Calgary Herald reported.
Natural gas and oil drilling is expected to drop by 10 percent in 2009 in Alberta, due to both decreasing commodity prices and the increase in royalties.
British Columbia and Saskatchewan, however, will see increases in drilling rates despite the increasing costs of production and the looming financial and energy crises.
British Columbia's drilling rate will be 29 percent higher, and Saskatchewan's drilling will be up 9 percent. Manitoba, however, is expected to drop by 3 percent.
In line with the recent report from PSAC, oil firm Canadian Natural Resources Ltd. cut its spending in Alberta for next year to $4 billion, down from $7.6 billion this year, the Vancouver Sun reported.
Saudi Arabia's Yanbu refinery is delayed
Saudi Arabia's Saudi Aramco and ConocoPhillips announced they will stop the bidding process for construction of the planned 400,000-barrel-per-day refinery at the Saudi city of Yanbu, Oil and Gas Journal reported.
Saudi Aramco and ConocoPhillips said the current financial market and commodity slump make the refinery much less attractive than it was when first announced.
The announcement may not mean the end of the project, however, as Saudi Aramco President and Chief Executive Officer Abdallah S. Jum'ah said his company and ConocoPhillips remain committed to eventually completing the refinery.
The bidding was supposed to take place in December and has been tentatively rescheduled for the second quarter in 2009.
The two firms have said they will continue with joint engineering, start-up planning and other preparatory activities for the $6 billion project that was first announced in 2006.
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Closing oil prices, Nov. 7, 3 p.m., London
Brent Crude oil: $60.78
West Texas Intermediate crude oil: $64.48
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