Sean Brodrick takes a closer look at the high usage of oil in America. In this issue of Money and Markets, Mr. Brodrick examines the amount of oil being used in other countries and explains how it is expected to increase.
Jupiter, Fla. (PRWEB) May 10, 2008 -- Sean Brodrick takes a closer look at the high usage of oil in America. Mr. Brodrick examines the amount of oil being used in other countries and explains how it is expected to increase.
The U.S. consumes about 20.6 million barrels of oil per day, or roughly 25% of global demand. China is the second-largest consumer at 7.2 million barrels per day and Japan, with 5.2 million barrels per day, is third. Gasoline demand has soared across China, which is home to over 200 cities with populations of one million people or more. In contrast, the United States has just nine cities with at least one million residents.
The U.S. also uses more petroleum than other countries. For example, China has more than four times the people that America does, and uses only a third of the oil. However, according to the International Energy Agency, China's overall oil demand rose by 7.8% in February from a year earlier, much higher than earlier estimates of a 5.3% gain. And gasoline demand rose by 22.8%. As a result of that surge in demand, China's crude oil imports rose 15% in the first quarter and 25% in March.
According to preliminary data from India, oil product sales surged by 10.9% in February compared to a year earlier. That's the fastest pace of growth in demand since 2006. Transportation fuels have also risen by 13.4% year-over-year. Across the developing world, oil use is rising higher. In 2008, emerging markets combined is expected to pass the U.S. in oil use.
The global demand for oil is most likely going to get worse and new oil production cannot keep up with declining production. Every year, producers need to find an additional 3 million to 3.5 million barrels per day of oil production just to offset declines from older fields. According to researchers, there are 546 giant oilfields in the world that currently account for just more than half of production. Only 80 of those fields are not fully developed. Oil production is already shrinking in 60 of the world's 98 oil producing countries.
The good news is that prices for oil and gasoline are made on the margins; if America cuts its oil use by 10% or even 5%, that could lower the price. 5% of the 20.6 million barrels used in the U.S. every day is about 1 million barrels per day. That's more than the current spare capacity on the global market.
"According to data from the state of California, Americans use 456 gallons of gasoline per person per year. Roughly, that's 400 million gallons of gasoline per day. Simply rolling back the speed limits and doing other gas-saving tips would cut gasoline use by 10%. That's 40 million gallons of gasoline per day, or 14.24 billion gallons of gasoline a year," Brodrick states.
To read this issue online, please visit:
http://www.moneyandmarkets.com/Issues.aspx?How-to-Get-Cheap-Gas-1762
About SEAN BRODRICK & MONEY AND MARKETS
Sean Brodrick joined Weiss Research in 2000 as an analyst, bringing more than 25 years experience as a journalist and financial analyst to the position. He is Weiss Research's small-caps specialist, especially in natural resources, and is the editor of the company's Red-Hot Canadian Small-Caps, as well as a regular contributor to its daily e-letter, Money and Markets.
Previously, Mr. Brodrick was the investment director of The Sovereign Society, the world's leading publisher of offshore asset protection strategies and global investment opportunities.
Recognized for his expertise on Canadian and Australian investment opportunities, Mr. Brodrick has been featured on many financial talk shows, including CNBC Squawk Box and Bloomberg Market Line. He is a weekly guest on Market Matters Radio, a contributing columnist to MarketWatch.com and a frequent commentator on one of Canada's premiere financial websites, HoweStreet.com. His report, "70 Days to Empty," has garnered acclaim for its analysis of the forces pushing America toward its next oil crisis and was described by
The Daily Reckoning as "the most important report you're likely to read this year," while his knowledge of uranium has helped investors earn solid gains on the commodity.
Mr. Brodrick holds a B.A. degree from the University of Maine.
Money and Markets (www.moneyandmarkets.com) is a free daily investment newsletter from Dr. Martin Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Weiss Research, Inc. is located in Jupiter, Florida. For more information about our editors, or to set up an interview, please contact Jennifer Moran at 561-627-3300 or visit www.moneyandmarkets.com.
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