Wednesday, April 25, 2012

Part 7: Inter-Regional Trade Movements of Petroleum to and from the Middle East


I could rant about how Google’s “upgrade” to blogspot as an example of a devolving civilization, but instead, let’s just get on with the series.  

In the context of discussing other regions, I have talked a lot about the Middle East (ME).  In Part 3, we saw seen prominent diminishing exports from the ME to North America (NA), and the same trends of diminishing exports to South America (SA), Africa (AF), and Europe (EU), in Part 4, Part 5, and Part 6, respectively. 

Where has that Middle East petroleum been going to, or, is this just part of an overall trend of there simply been less exports of petroleum out of ME?  As you will see, ME’s total inter-regional exports of petroleum have only slightly declined, but those exports are being diverted to some parts of Asia. 

The Middle East's Total Petroleum and Crude Oil Production and Consumption Trends
Figure 1 presents ME’s total petroleum consumption rate (i.e., both domestic and imported petroleum) since 1980 as reported by the EIA or BP review (solid red circles and squares, respectively). 

 
Both the EIA and BP data set illustrate the long-time increase in ME’s consumption of petroleum, and, as I showed over a year ago, this consumption rate data, when fit the Hubbert Equation, suggests a yearly growth rate in consumption of 5.6 percent per year. 

Figure 2 shows ME's total petroleum production rate (i.e., the entire region’s domestic production, solid blue circles and squares for EIA and BP data, respectively) and crude oil production (solid purple circles). 

Note the ~3 times larger vertical scale in Figure 2 as compared to Figure 1, which just illustrates that ME is a very large net exporter of petroleum. 

What I find most striking about Figure 2 is that the ME’s production (solid circles and squares) has pretty well “flat lined” at about 9-9.5 bby since about 2004-2005 (again, depending on whether you take the EIA or the BP numbers). 

The Middle East’s Gross and Inter-regional Export and Import Trends
Figure 1 also shows ME's gross and inter-regional imports of total petroleum, crude oil and petroleum products.  The EIA import data (open red circles) only runs from 1984 to 2008 while the BP review import data (open red squares) only run from 2000 to 2010.  The same applies to the export data in Figure 2.

As illustrated in Figure 1, the much small magnitude of ME’s gross imports (open red circles) or inter-regional imports (open red squares) illustrates that ME’s increasing consumption is being fed from within.  That is, ME has been increasingly consuming it’s own petroleum production.  For example, in 2010, of the 2.6-2.8 bby of petroleum consumed by ME (depending on whether you take the EIA or the BP numbers), only 0.16 bby came from imports from outside of the region, although it looks like there is an up-trend in the inter-regional and gross imports.  Still the amounts are very small. 

As illustrated in Figure 2, during the past several years of the ME’s flat-lined production, inter-regional exports (open blue sqaures) have slightly declined, e.g., from 7.4 bby in 2005 to 6.9 bby 2010, no doubt to help feed the increased domestic consumption.   

Another interesting thing about Figure 2 is that it shows that ME has relatively low petroleum product exports: only about 0.8 bby (open green squares) compared to crude oil exports of 6 bby (open brown squares).  This suggest to me that ME doesn’t have much excess capacity to refine its own crude oil into more lucrative petroleum products from exports.

Figure 3 shows ME's total petroleum, crude oil and petroleum product imports relative to the respective gross and inter-regional global petroleum import pools. 

As one might expect, the ME’s imports relative to the total global import is very small—total gross imports (red circles) of only about 2 to 3 percent of the total global pool and total inter-regional imports (red squares) of less than 1 percent of the total global pool, although there is an up-trend in inter-regional imports over the past decade.

Figure 4 shows ME's exports relative to the respective total gross and inter-regional global petroleum export pools, which, of course, is about the same as the global import pool.  

Note the order-of magnitude larger vertical scale of Figure 4 compared to Figure 3, signifying the ME’s important role as a major petroleum exporting region,  In 2000, about 50 percent of all inter-regional global exports (blue squares), mostly crude oil (brown squares), came from ME.  But, by 2010, only about 41 percent of global inter-regional exports came from the ME.  This suggests to me that the ME’s role as the key contributor to the petroleum export pool is in decline. 

As suggested by Figure 2, the decrease in the relative importance of the ME as an export source was not due to a decline in absolute rates of petroleum production.  As also noted in the context of Figure 2, there has been a slight decline in absolute export rates, but not enough to totally explain the 9 percent difference from 2000 to 2010.  I suspect that it is increasing exports, mainly from the former Soviet Union region (FS), which in turn, has expanded the total global export pool, also helps explains the declining relative importance of the ME as an export source.  But that’s a story for another day.

Middle East Intra-regional Export and Import Trends
The difference between the gross and inter-regional imports or exports, shown in Figures 1 and 2, respectively, should correspond to intra-regional trade movements of petroleum.   For the reasons presented in Part 3, I think that these differences are only rough estimates of intra-regional imports and exports.  But still, I continue to show the differences because they illustrate the intra-regional trends for each region. 

Figure 5 shows the differences between the gross and inter-regional total, crude oils and petroleum product imports, which should equal the intra-regional values for these quantities. 
 
As you can see, the difference between gross and inter-regional total petroleum imports (red triangles 0.3-0.4 bby) is about 3 to 4 times larger than the inter-regional imports (0.07 to 0.16 bby; Figure 1: open red squares).  This suggests that there are more intra-regional imports than inter-regional imports.  Probably, the intra-regional imports involve the movement of petroleum (notice how petroleum products green trianlges are up over the last decade) to those countries in the ME region that don’t produce substantially amounts of their own: Israel, Jordan, Lebanon, Palestine (see e.g., Survey of Oil Exports from the Middle East). 

Figure 6 shows the differences between the gross and inter-regional total, crude oil and petroleum product exports, which should equal the intra-regional export values for these quantities. 

Figure 6 shows the same trends as in Figure 5, but with wild fluctuations—intraregional exports (blue triangles) on the order of 0.2 bby.

Trade movements of total petroleum between the Middle Esat and other regions
Figure 7 show the specific quantities of petroleum, in units of bby, imported by ME FROM each of the eight other regions.  For reference, Figure 7 also shows the sum of ME's total inter-regional petroleum imports from all eight of the other regions (black "Xs"), which is the same as presented in Figure 1 (red open squares).

The total inter-regional petroleum imports, the black X’s, illustrate that ME's imports from the other regions is slowly rising, e.g., from 0.07 bby in 2000 to 0.16 bby in 2010. 

But, the BP review’s summary of inter-regional imports does not provide the break-down of inter-regional imports from the individual regions, probably because the import contribution from individual regions is below their reporting cut-off, which is probably about 0.01 bby. 

Figure 8 shows petroleum exports from ME TO each of the eight other regions and again, for reference, I show ME’s total exports (black “Xs” corresponding to the blue squares in Figure 2).  Again note the much larger vertical scale as compared to Figure 7, illustrating the ME’s role as a large net exporter of petroleum.

The black X’s in the figure illustrate that, over the last decade, although there is a down-trend  relative to the total global export pool, the ME's total inter-regional exports have stayed fairly flat at about 7 bby.  The top export destination of the ME’s exports during this period are the remaining Asia Pacific region countries (rAP; brown circles), that is, the countries  in the Asia Pacific other than Japan (JP, golden triangles) and China (CH, pink circles).  JP and CH are separately accounted for in figure 8.  In 2010, rAP received 3 bby of the ME’s 7 bby in exports, which was more than double than JP’s 1.3 bby and CH’s 0.9 bby.  These three, rAP, JP, CH—totaling 5.2 bby—were the number one, two and three export destinations for the ME’s petroleum.  That corresponds to nearly 74% of all of the ME’s petroleum exports going to these Asian destinations. 

In 2000, CH only got 0.26 bby, or 3.7 percent, of ME's petroleum exports, but by 2010, that was up to about 13 percent of ME's exports.  Similarly, rAP received 2.3 bby, or 33 percent, of ME's exports in 2000, but by 2010, that was up to 43 percent.

It is pretty clear that these increases to CH and rAP over the last decade are at the cost of declining exports mainly to EU, NA and JP.

In 2000, EU and NA were the number three and four import destinations, respectively, for the ME’s exports. For instance, in 2000, ME's exports to EU and NA were 1.4 and 1 bby, respectively.  That total of 2.4 bby equaled about 35 percent ME’s petroleum exports in that year.  But, by 2010, EU and NA together were only receiving 1.5 bby or 22 percent of ME's exports.  During the last decade, exports to JP have declined as well: from 1.5 bby or 22 percent in 2000 to 1.3 bby or 19 percent in 2010. 

Since ME's total exports have not changed much during the decade these trends for declining exports to EU, NA and JP, and increasing exports to rAP and CH, are a clear transfer of the ME's petroleum wealth away from the EU, NA and JP,  regions and towards these two developing Asian regions.

Figures 9 and 10 present the same data as shown in Figures 7 and 8, respectively, but expressing ME's petroleum imports or exports, to or from each of the eight regions, as percentages of the total global inter-regional petroleum import/export pool (global inter-regional imports and exports are the same).  For reference, I also show ME’s petroleum imports and exports as percentages of the global petroleum import/export pool (“Xs” right vertical axis; note the different scale).

Additionally, I have taken all of these data and made linear extrapolations of the 2000 to 2010 data (via linear regression analysis) out to 2021. 

Figure 9, like Figure 7, is not much of a story, because imports from the other eight individual regions are not reported in the BP reviews.  There is a trend for the ME’s total inter-regional imports to be slowly increase at a rate of 0.01 bby (slope, r2=0.81).
Figure 10 more clearly shows the export trends as discussed in the context of Figure 8, but now as the percentages relative to the ME's total exports in any one year. 

Some additional aspects of the export trends which are brought out better in this figure are the ME's export down-trends to South America (SA) and Africa (AF).  The linear regression trend line (r2=0.76) predicts zero exports to SA by 2012, and a slower, less certain, decline in exports to AF (r2=0.5) to 1.3 percent by 2021. 

If the trends for declining exports continue, then by about 2019, EU will no long be receiving any of the ME's petroleum (trend line r2 = 0.95).  NA would only be receiving about 2 percent (trend line r2 = 0.9) by 2021, and, JP would be down to 14 percent (trend line r2 = 0.98) of the ME's petroleum exports by 2021. 

In contrast, by 2021, about 61 percent of the ME's exports would go to rAP (trend line r2 = 0.6) and about 27 percent would go to CH (trend line r2 = 0.93).  Note, these extrapolated percentages don't add up to 100—that's because the linear extrapolations for EU and SA both go into negative territory before 2021.   But normalizing for this (e.g., by setting all subsequent years to zero after 2018 and 2012, respectively) wouldn't change the above percentages by very much.

Figures 11 and 12 show these percentage changes in ME's import sources and export destinations, respectively, as a percentage of the ME's total exports or imports in the years 2000 and 2010, and, as predicted in 2021, from the linear regression trend lines shown in Figures 9 and 10.

Again there is no story in Figure 11, because the ME's imports of petroleum from the individual other eight regions is very small.

I decided to present two different perspective views for Figure 12, to more clearly show the regional export trends.  As you can see in Figure 12a, exports to NA, SA and EU are all down steeply, while exports to rAP are up strongly.  As illustrated in Figure 12b, exports to JP and AF are trending down and exports to CH are up strongly. 


Summary and Conclusions
The Middle East's petroleum production rates have be quite flat over the past 6-7 years, and this is likely a sign of reaching peak production (Figure 2).  The Middle East's petroleum inter-regional export rate has been flat over the last decade (Figure 2).  Expressed as a percentage of the total inter-regional export pool, however, the Middle East's relative contribution to the export pool has declined (Figure 4), and, domestic consumption rates are continuing their long-term increase (Figure 1). 

The decade long constancy of the Middle East's total petroleum inter-regional exports, however, provides no hint of the large change in the export destinations for this petroleum over the past decade.  There has been a large shift in the Middle East's exports away from the Western regions: North America, Europe, South America and Africa, as well as Japan, and, towards the East, specifically China and the remaining Asia Pacific countries.  In 2010, about 74 percent of the Middle East's petroleum exports went to the latter three two  regions, and the trend is for this to increase going forwards.

If one of the goal's of the West's military interventions into the Middle East (i.e., Gulf War I and II), were largely about safe guarding a steady flow of Middle Eastern oil for the benefit North America and Europe, as some in the know have speculated, then this strategy has substantially failed, as illustrated by the trends in Figure 10 and 12.  It would seem that, even without Saddam Hussein controlling the Middle East, the flow of oil has shifted away from the West and Japan and towards China and the remaining parts of Asia.  If the present trend continues, in a decade's time, the Middle East will be a relatively minor supplier of oil to the West and the major supplier to these Asian regions. 
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Next time, I will describe the former Soviet Union’s petroleum Export and Import Trends. 

4-26-2012: Correcting my typo: the 74% refers to exports to the latter three: China, Japan and remaining Asia Pacific region

Saturday, April 14, 2012

Part 6: Inter-Regional Trade Movements of Petroleum to and from Europe

In Part 1, I introduced my abbreviations, data bases and analysis methods, Part 2 presented the global trends, Part 3 presented the inter-regional trade movements to and from North America and Part 4 presented inter-regional trade movements to and from South America, and Part 5 presented the same for Africa.

Up to now in the series, part 2 revealed that 2007 was the peak in the total global pool of petroleum involved in inter-regional trade movements (i.e., imports and exports between any of nine regions: North America (NA); South America (SA); Europe (EU); former Soviet Union (FS); Middle East (ME); Africa (AF); China (CH); Japan (JP); Asia-Pacific remainder (APr)).  Now, as we proceed along to downside of a diminishing petroleum export pool, what are the trends suggesting how the remaining petroleum will get distributed between these nine regions?

In part 3, we saw a trend for diminishing imports to North America, especially from South America, and the Middle East, with Africa and the Former Soviet Union picking some but not all of the slack.  Exports, particularly petroleum products, from North America, to South America and Europe, having been rising.  In part 4, we saw that those diminishing South American exports to North America were essentially being diverted to China, the other Asia Pacific countries (but not Japan) and to Europe.  Part 5 showed that Africa’s exports of petroleum to Europe were declining with North America and China receiving the benefit of increased exports from Africa.  Africa’s imports of petroleum, mostly crude oil, from the Middle East have dropped, while imports of petroleum products from Europe have increased.

So, with exports of petroleum from Africa to Europe declining, besides South America, has Europe been able to pick up the difference from anywhere else?  Da.

Europe's Total Petroleum and Crude Oil Production and Consumption Trends
Figure 1 presents EU’s total petroleum consumption rate (i.e., both domestic and imported petroleum) since 1980 as reported by the EIA or BP review (solid red circles and squares, respectively). 

 
Both the EIA and BP data set illustrate that after reaching a minimum of 3 bby in about 1983, EU’s consumption of petroleum peaked in 2005-2006 at 6 bby and by 2010 was back down to 5.5 bby, which is roughly the same as EU’s consumption rate in 1994.

Figure 2 shows EU's total petroleum production rate (i.e. domestic production, solid blue circles and squares for EIA and BP data, respectively) and crude oil production (solid purple circles). 

Note the 1/2 vertical scale in Figure 2 compared to Figure 1, which shows that EU is a very large net importer of petroleum.  While it consumed 5.5 bby in 2010, EU only produced 1.6-1.7 bby, depending on whether you use the EIA or BP review numbers.  That means EU only produced about 30% of what it consumed—the other 70% had to be net imported from countries outside of EU.  In comparison, from part 3, NA produced 5.4-5.9 bby, depending on whether you use the EIA or BP review numbers, which is about 63-69% of the 8.5 bby NA consumed.  That means NA net imported 37-31% of what it consumed from countries outside of NA. 

I hear lots of main-stream media talk about NA’s, specifically USA’s, dependence on “foreign oil,” but EU is relatively far more dependent on inter-regional, or distant foreign oil than NA is.

And the situation is getting worse each year, as it is quite clear that EU’s petroleum production has been in decline ever since EU fell off a several year “undulating plateau” in production rates starting in about 2002.  The crude oil production rates (purple circles) pretty well mirrors this same trend and in 2010 it was back down to the same rate, 1.4 bby, it was at in 1983. 

Europe's Gross and Inter-regional Export and Import Trends
Figure 1 also shows EU's gross and inter-regional imports of total petroleum, crude oil and petroleum products.  The EIA import data (open circles) only runs from 1984 to 2009 while the BP review import data (open squares) only run from 2000 to 2010.  The same applies to the export data in Figure 2.

EU shows signs of a peak in gross total petroleum imports in 2006 and inter-regional total petroleum imports around 2007-2008.

It seemed curious to me that EU’s gross imports of petroleum (open red circles) actually exceeded total petroleum consumption (solid red circles or squares), and I had to go back and double check.
But, I have to keep in mind that the gross imports, derived from the EIA’s data, is the sum of all imports for all the countries in the EU region.  That includes both inter-regional imports, from countries outside of EU, and intra-regional imports, between countries within EU.  The intra-regional import number must be quite large, around 2 bby.  Effective this is saying that most of the petroleum produced in EU (e.g., Norway, The Netherlands, UK) stays in EU by getting distributed to the relatively low-producing countries (e.g., Sweden, France, Germany). 

Figure 2, which shows EU's gross and inter-regional total petroleum, crude and petroleum products exports is consistent with this: the gross exports (open blue circles or squares) well exceeds total production (solid circles).  Also notice how large gross product exports (green circles)—this component of exports alone actually exceeded total production in the last five years.   In comparison, the interregional exports of total petroleum or petroleum products (blue and green squares, respectively) are much smaller.  Again this implies that the bulk of production within EU and imports into EU got distributed as intra-regional exports within EU.

Figure 3 shows EU's total petroleum, crude oil and petroleum product imports relative to the respective gross and inter-regional global petroleum import pools. 

The declining trends in both gross total, crude oil and produce imports (open red, brown and green circles) is pretty obvious. The inter-regional imports of these quantities (open red, brown and green squares) has been pretty flat, except for 2009 and 2010 which show a sharp decline in total imports, due to a decline in crude oil imports.  

Figure 4 shows EU's exports relative to the respective total gross and inter-regional global petroleum export pools, which, of course, is about the same as the global import pool.   As have noted in the past, similar to the imports trends shown in Figure 3, these relative export amounts are expressed as a percentage of the total gross export pool and the total inter-regional export pool, and, these total pool sizes are different: e.g., 23 bby of gross exports in 2008 versus 17.1 bby inter-regional exports in 2008. 

Figure 4 has a one-half vertical scale as Figure 3 because EU’s contributes a smaller amount of petroleum into the global export pool than it imports from the pool—that is, EU is a very strong relative net inter-regional importer; a larger importer than NA, for example.

EU’s gross and inter-regional exports are on a long-term down-trend; the inter-regional total petroleum exports (blue squares) are drop about 20%, from 5.1% of the total export pool in 2000, to 4.1% of the total export pool in 2010.  The inter-regional decline is due to the decline in crude oil exports (open brown squares); in comparison, petroleum product exports (open green squares) have actually increased slightly from 2.2% in 2000 to a peak of 3.7% of the total export pool in 2008, but drop to 3.3% in 2010.  Those product exports are not too important globally, but they are important to NA and AF, as I will further discuss below. 

But first, let’s spend a few minutes considering the intra-regional import/export situation implied by the EIA and BP review data.

European Intra-regional Export and Import Trends
The difference between the gross and inter-regional imports or exports, shown in Figures 1 and 2, respectively, should correspond to intra-regional trade movements of petroleum.   For the reasons presented in Part 3, I think that these differences are only rough estimates of intra-regional imports and exports.  But still, I continue to show the differences because these illustrate some interesting trends for each region. 

Figure 5 shows the differences between the gross and inter-regional total, crude oils and petroleum product imports, which should equal the intra-regional values for these quantities. 

As you can see the difference gross and inter-regional total petroleum imports (red triangles) is relatively large, but declining, about  2.5 bby in 2000 to 1.8 bby in 2010.  For instance, this is even larger than the intra-regional imports within North America which was about 1.5 bby in 2010 (see figure 5, part 4).

The trends for the two components of this total, crude oil and petroleum product intra-regional imports, are different.  Crude oil intra-regional imports (brown triangles) are in steep decline—this makes sense to me because as seen in Figure 2, crude oil production with EU is in steep decline.  In contrast, petroleum product intra-regional imports (green triangles) has stayed fairly flat in the last decade, although there have been large oscillations in the import numbers, between 1 and 1.5 bby, in the last few years

Figure 6 shows the differences between the gross and inter-regional total, crude oil and petroleum product exports, which should equal the intra-regional export values for these quantities. 

Figure 6 shows about the same trends as in Figure 5: total petroleum intra-regional exports (blue triangles) are in decline, mostly due to declining crude oil intra-regional exports (brown triangles) with flat petroleum product intra-regional exports (green triangles)

Trade movements of total petroleum between Europe and other regions
Figure 7 show the specific quantities of petroleum, in units of bby, imported by the EU FROM each of the eight other regions.  For reference, Figure 7 also shows the sum of EU's total inter-regional petroleum imports from all eight of the other regions (black "Xs"), which is the same as presented in Figure 1 (red open squares).

 
Those inter-regional total petroleum imports, the black X’s, illustrate that EU's imports from the other regions peaked ar 5.1 bby in 2007 and has declined since then.  Figure 7 all illustrates that EU has three main inter-regional import sources: FS, ME and AF.  There are much more minor import contributions from NA and SA.  Over the last decade imports from ME have declined fairly steeply decline whereas the trend for imports from the FS have strongly increased.  It looks like FS replaced ME as the top import source in 2001, and then by 2008 AF replaced ME to become the number two import source.  The later is simply because the rate of declining imports from ME is faster than the rate of decline in imports from AF.

Figure 8 shows petroleum exports from EU TO each of the eight other regions and again for reference, I show EU’s total exports (black “Xs” corresponding to the blue squares in Figure 2).  Note the much smaller vertical scale as compared to Figure 7, illustrating the EU is a larger net importer of petroleum.

The black X’s in the figure show that EU's total inter-regional exports have stayed relatively small and flat between 0.7 and 0.8 bby. By far the bulk of these exports, mostly petroleum products, have gone to NA, although the trend is for declining exports to NA in favor of increased exports to AF, rAP and SA.  For instance, in 2010 0.53 bby, or 74% of EU's total exports went to NA, but by 2010, the exports to NA were down to 0.37 bby, or 53% of EU's total exports. 

Figures 9 and 10 present the same data as shown in Figures 7 and 8, respectively, but expressing EU's petroleum imports or exports, to or from each of the eight regions, as percentages of the total global inter-regional petroleum import/export pool ( global inter-regional imports and exports are the same) .  For reference, I also show EU’s petroleum imports and exports as percentages of the global petroleum import/export pool (“Xs” right vertical axis; note the different scale). 

Additionally, I have taken all of these data and made linear extrapolations of the 2000 to 2010 data (via linear regression analysis) out to 2021. 

Figure 9 shows the import trends discussed in the context of Figure 7: increasing amounts of petroleum imports from FS, decreasing imports from ME and slightly declining imports from AF.  The trends for imports NA and SA are obscured at the bottom of the figure, but, the trend is for slightly increasing imports from both regions, but not enough to make up for the declining imports from AF.

The linear extrapolation of the trend for the ME (r2 = 0.95), if continued forward, suggests no imports from the ME by about 2019. 

Figure 10 shows the export trends discussed in the context of Figure 8:  declining exports from EU to NA, and, increasing exports from EU to AF and the mysterious “UN.” 

UN does not stand for United Nations, but rather, the BP review defines this as “Unidentified,” and states that this includes “changes in the quantity of oil in transit, movements not otherwise shown, unidentified military use etc.”  for most regions this is very small, but for EU this rises above the baseline.  For instance, in 2010, exports from EU to “UN,” about 0.08 bby, amounted to about 0.5% of the global export pool.  Somewhat interesting, but I have no way to further account for this "UN."  My speculation is that this probably corresponds to some of EU’s large amount of intra-regional exports which can’t be specifically accounted for as such. 

Figures 11 and 12 show the relative changes in EU's import sources and export destinations, respectively, as a percentage of EU's total exports or imports in the years 2000 and 2010, and, as predicted in 2021, from the linear regression trend lines shown in Figures 9 and 10.

Figure 11 illustrates the trends for increased imports from FS and the steep decline in imports from the ME.  In 2000 the ME was providing 35 percent of EU’s imports, and by 2010 that number was down to 20 percent. 
A continuation of that trend will mean that ME is no longer a import source to EU by 2021.  Instead, EU would be heavily dependent for petroleum imports from FS, which of course in mainly Russia.  In 2010, EU got 30% of its imports from FS, which is 5% less than from ME.  By 2010, FS was EU’s main import source, providing just under 50% of EU’ petroleum imports.  Continuing that trend via linear regression (r2=0.78) suggests, that by 2021, EU would be getting 77% of its imports from FS, and another 17% from AF (with NA and SA each providing another 5% each).

Figure 12 illustrates how EU’s petroleum export destinations are moving away from NA and towards AF, and to lesser extents, rAP and SA. 

In 2000, 74% of EU’s exports went to NA, but by 2010, that was down to 53%, and, a linear extrapolation of this trend (r2=0.83) suggests that only 13% of EU’s exports would go to NA, with the bulk, 38%, going to AF, and another 13% and 14% going to SA and rAP, respectively. 

Summary and Conclusions
Europe’s petroleum production has been in a strong decline since 2002, and presently, only equals about 30% of Europe’s petroleum consumption.  Despite fairly steep declines in production, Europe’s consumption of petroleum has changed little in the last decade.  Consequently, Europe has to import 70% of the petroleum that it consumes, which is relatively more than what North America imports.   With continuing declines in petroleum production, Europe will have to import ever-increasing amounts of petroleum.  The startling trend (shown in Figures 9 and 11) is that Europe has looked increasingly to the former Soviet Union countries as its primary source of imports.  Indeed, in 2010, roughly 50% of Europe’s inter-regional imports came from the former Soviet Union countries, up from 30% in 2000.  If the last decade’s trend continues, then we might expect 77% of Europe’s petroleum to come from former Soviet Union countries alone by 2021.   However, total inter-regional petroleum imports to Europe peaked in 2007-2008, at about 5 billion barrels per year, and, imports were down to 4.4 billion barrels per year by 2010 (Figure 1), mainly do to a long-term trend of declining imports from the Middle East.

If I were a European, I would be worried about these trends.  It is bad enough to be 70% and counting dependent on truly, “foreign (i.e., inter-regional) oil,” but to be so dependent on a former cold war nemesis is even worse.  Is it too far-fetched or paranoid to imagine how the former Soviet Union countries, particularly Russia, could use petroleum imports as political leverage to influence and divide the domestic and foreign policies of the highly oil-dependent countries in Europe to its advantage?  

And, going forwards, what would happen to European consumption if exports from the former Soviet Union countries to Europe start to decline, e.g., because the former Soviet Union country’s petroleum production starts to decline, and/or former Soviet Union countries find more lucrative destinations (i.e., China, Japan or the remaining Asia Pacific countries) to export their petroleum to?  Europe is not a good example of having multiple, flexible sources of petroleum to import from. 
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Next time, I head south again to examine the Middle East’s petroleum Export and Import Trends. 

Friday, April 6, 2012

Part 5: Inter-Regional Trade Movements of Petroleum to and from Africa

In Part 1, I introduced my abbreviations, data bases and analysis methods, Part 2 presented the global trends, Part 3 presented the inter-regional trade movements to and from North America and Part 4 presented inter-regional trade movements to and from South America. 

Up to now in the series, part 2 revealed that 2007 was the peak in the total global pool of petroleum involved in inter-regional trade movements (i.e., imports and exports between any of nine regions: North America (NA); South America (SA); Europe (EU); former Soviet Union (FS); Middle East (ME); Africa (AF); China (CH); Japan (JP); Asia-Pacific remainder (APr)).  Now, as we proceed along to downside of a diminishing petroleum export pool, what are the trends suggesting how the remaining petroleum will get distributed between these nine regions?

In part 3, we saw a trend for diminishing imports to North America, especially from South America, and the Middle East, with Africa and the Former Soviet Union picking some but not all of the slack.  Exports, particularly petroleum products, from North America, especially to South America and Europe, is rising.  In part 4, we saw that those diminishing South American exports to North America were essentially being diverted to China, the other Asia Pacific countries (but not Japan) and to Europe. 

And now what are the trends for Africa?

Africa's Total Petroleum and Crude Oil Production and Consumption  Trends
Figure 1 presents AF’s total petroleum consumption rate (i.e., both domestic and imported petroleum) since 1980 as reported by the EIA or BP review (solid red circles and squares, respectively). 

Both the EIA and BP data set illustrate AF's growing consumption of petroleum from 0.5-0.55 bby in 1980 to 1.2-1.24 bby in 2010, with no plateau in sight. 

Figure 2 shows AF's total petroleum production rate (i.e. domestic production, solid blue circles and squares for EIA and BP data, respectively) and crude oil production (solid purple circles). 

Note the 3 times larger vertical scale in Figure 2 compared to Figure 1.  Since 1980 AF has been producing well over triple the petroleum that is consumes making it a relatively large petroleum exporter.  But there are clear signs that AF's rate increase in total petroleum production has slowed down since about 2005, which could be a sign of peaking production rates.  The close tracking between crude oil production (purple circles) and total petroleum production (blue circles and square) illustrates that since 1980, nearly all (over 90%) of AF's production has been crude oil production

Africa's Gross and Inter-regional Export and Import Trends
Figure 1 also shows AF's gross and inter-regional imports of total petroleum, crude oil and petroleum products.  The EIA import data (open circles) only runs from 1986 to 2008 while the BP review import data (open squares) only run from 2000 to 2010.  AF shows signs of a peak in inter-regional petroleum imports around 2007-2009.

From 1986 to 1997 AF's gross total petroleum imports (open red circles) were fairly flat at 0.3-0.4 bby, after which imports rose to 0.7 bby by 2005.  The total inter-regional imports (open squares) also shows increasing import rates for 2000 to 2007, but then a plateau for a few year and then a strong down turn in 2010.  In is apparent that that 2010 down turn in inter-regional total petroleum is reflecting a down turn in inter-regional crude imports (open brown squares).  The gross crude oil imports (open brow circles) are only slightly higher than inter-regional crude oil imports, implying that intra-regional imports (i.e., imports from one country within AF to another country within AF) are small.  The increase in total petroleum imports after 1997 is mainly explained by petroleum product imports (open green circle) which started to rise in 1997.  Inter-regional imports (open green circles) increased from 2000 to 2008 and has slight gone down since then.

Figure 2 also shows AF's gross and inter-regional total petroleum, crude and petroleum products exports.  Once again, The EIA import data (open circles) only runs from 1986 to 2008 and the BP review import data (open squares) only run from 2000 to 2010.

Gross total petroleum and crude oil exports increased fairly steadily since 1986 until 2004 when a plateau was reached.  Inter-regional exports of total petroleum and crude oil peaked in 2007 at 3.2 and 2.9 bby, and have declined to 2.9 and 2.6 bby, respectively, by 2010. 

Gross and inter-regional petroleum product exports are comparatively much smaller at 0.4 to 0.3 bby and the close similarly of gross and inter-regional numbers implies that there has very little intra-regional exports of the petroleum products within AF.

Figure 3 shows AF's total petroleum, crude oil and petroleum product imports relative to the respective gross and inter-regional global petroleum import pools.  AF’s signs of a peak in inter-regional petroleum imports around 2007-2009 is even more clear than in Figure 1.

After hitting a minimum of about 2 percent of the gross total petroleum import pool (red circles) in 1996, AF gross total petroleum imports has risen steadily to 3 percent by the last EIA reporting year 2008. Gross crude oil imports (brown circles) during this period are flat to declining at about 1.7 to 1.5 percent.  In contrast the gross product imports (green circles) increased from 0.7 percent to 1.7 percent and pointed out in the context of Figure 1, it is this which explains the increase in total petroleum imports since in1996.

AF’s inter-regional total petroleum imports (red square) corresponded about 2.5 percent of the total inter-regional import pool until 2007 when it vaulted up to 3 percent and then in 2010 fell off a cliff to below 2 percent.  Inter-regional crude oil imports (brown squares) were fairly stable at 1.5 to 1.7 percent of the total inter-regional import pool until 2010, when it dropped precipitously to 0.7 percent in 2010.  AF’s share of the inter-regional petroleum product imports pool (greensquare) increased from a steady 0.9 to 1.3 percent in 2007, but has steadily declined since then.

The trends shown here and in Figure 1 are similar to South America’s, discussed in part 4:  AF’s crude imports are flat to declining while petroleum product imports are increasing.  AF’s draw on the inter-regional import pool of petroleum at 2-3 percent is even smaller than SA’s. 

Figure 4 shows AF's exports relative to the respective total gross and inter-regional global petroleum export pools, which, of course, is about the same as the global import pool.   Analogous to the imports trends shown in Figure 3, these relative export amounts are expressed as a percentage of the total gross export pool and the total inter-regional export pool, and, these total pool sizes are different: e.g., 23 bby of gross exports in 2008 versus 17.1 bby inter-regional exports in 2008. 

Figure 4 has a much larger vertical scale than Figure 3 because AF’s contributes much more into the global export pool than it imports from—AF is a very strong relative net exporter; much stronger than SA, for example.

Except for a slight up tick in the early 90’s AF’s gross total petroleum exports (blue circles) has been quite steady at about 13 of the gross export pool.  By far it is crude oil (brown circles) that makes up the bulk of AF’s exports.  AF’s gross crude oil exports supported 11 percent of the global export pool from 1986 to 2008, with petroleum products exports (green circles) providing another 2 percent. 

AF’s total inter-regional petroleum exports (blue square) makes up an even larger portion of the inter-regional export pool, peaking at 18.5 percent in 2007 and down to 17.2 percent in 2010.  Again most of the inter-regional exports are from crude oil exports (brown square) with petroleum product imports (green squares) providing a very steady 2 percent of the total global inter-regional export pool.

African Intra-regional Export and Import Trends
The difference between the gross and inter-regional imports or exports, shown in Figures 1 and 2, respectively, should correspond to intra-regional trade movements of petroleum.   For the reasons presented in Part 3, I think that these differences are only rough estimates of intra-regional imports and exports.  But still, I will show the differences, with some brief commentary.

Figure 5 shows the differences between the gross and inter-regional total, crude oils and petroleum product imports, which should equal the intra-regional values for these quantities. 

As you can see the difference gross and inter-regional total petroleum imports (red triangles) is quite small, about 0.2 bby.  In comparison North American and South American intra-regional imports were 1.5 bby and 0.8 bby, respectively (see parallel figure 5 in parts 4 and 5, respectively).

Crude oil intra-regional imports (brown triangles) have increased, while product imports (green triangles) have declined, resulting in a pretty flat trend in total intra-regional petroleum exports (red triangles) at about 0.8 bby.  There is a trend for petroleum product intra-regional imports (green triangles) to be increasing and crude oil imports (brown triangles) to be decreasing.

Figure 6 shows the differences between the gross and inter-regional total, crude oil and petroleum product exports, which should equal the intra-regional export values for these quantities. 

Total petroleum intra-regional exports (blue triangle) are similarly very small, about 0.3 to 0.4 bby from 2000 to 2005 and then essentially zero since then.  Both crude oil and product intra-regional exports (brown and green triangles, respectively) are trending towards zero.
So where does AF’s petroleum exports go, and, what source was the cause of that dramatic loss in crude oil imports in 2010?  Let’s see if the BP review’s trade movement data can provide some insights.

Trade movements of total petroleum between Africa and other regions
Figure 7 show the specific quantities of petroleum, in units of bby, imported by AF FROM each of the eight other regions.  For reference, Figure 7 also shows the sum of AF's total inter-regional petroleum imports from all eight of the other regions (black "Xs"), which is the same as presented in Figure 1 (red open squares).

 
As you can see AF's inter-regional total petroleum imports (black X’s) steadily rose to 0.5 bby in 2007 and then dropped back down to 0.3 bby by 2010—that’s even lower than AF’s imports in 2000.  The drop in imports was due to a more than 50 percent decrease in imports from the Middle East (ME) from 0.33 bby in 2007 to 0.11 bby in 2010.  The overall decline in AF’s imports would have been even greater but for a slight increase in imports from Europe (EU) in 2009, and more minor increases in imports from North American (NA) and remaining Asia Pacific regions (rAP). 

The decline in petroleum imports from the ME is so dramatic that if the trend continues then EU would be AF’s number one import source. 

The BP review data doesn’t break this out, but my hunch is that the dramatic drop in crude oil imports and the increases in petroleum product imports shown in Figures 1 and 3, are likely due to a strong decline in crude oil coming from ME, and, increases in petroleum products from EU, NA and rAP. 

Figure 8 shows petroleum export from AF TO each of the eight other regions and again for reference, I show AF’s total exports (black “Xs” corresponding to the blue squares in Figure 2).  Note the much larger vertical scale compared to Figure 7, illustrating AF’s role as a relatively large net exporter of petroleum.

Figure 8 illustrates the general upward trend in AF’s total petroleum exports, and shows that EU and NA are about presently about equal major export destination for AF’s petroleum both at about 1 bby in 2010.  The trend is for increasing exports to NA with exports to EU remaining flat to decling. 

Despite the slight increases in imports from EU and NA, AF exports far more petroleum to either region: 0.11 bby from EU to AF, versus 0.95 bby from AF to EU in 2010; 0.03 bby from NA to AF versus 0.92 bby from AF to NA in 2010.

However, after peaking at 1.1 bby to NA in 2005, exports to NA have since declined to 0.85 bby.   This quantity is still about 3 times more than the 0.29 bby of petroleum that NA sends to SA (Figure 7), so SA is still a net petroleum exporter with respect to NA. 

While AF’s exports to rAP is flat at about 0.3 bby, there has been a large increase in export from AF to China (CH) and a lesser expect SA.  Over the last decade exports to CH increased from 0.12 to 0.49 bby; exports to SA increased from 0.06 to 0.13 bby—those are over 400 and 200 percent increases, respectively. 

Figures 9 and 10 present the same data as shown in Figures 7 and 8, respectively, but expressing AF's petroleum imports or exports, to or from each of the eight regions, as percentages of the total global inter-regional petroleum import/export pool ( global inter-regional imports and exports are the same) .  For reference, I also show AF petroleum imports and exports as percentages of the global petroleum import/export pool (“Xs” right vertical axis; note the different scale). 

Additionally, I have taken all of these data and made linear extrapolations of the 2000 to 2010 data (via linear regression analysis) out to 2021. 

Figure 9 shows the import trends discussed in the context of Figure 7: increasing amounts of petroleum imports from EU rAP and NA and strongly decreasing imports from ME.


Figure 10 shows the export trends discussed in the context of Figure 8:  declining exports from AF to EU and rAP, and, increasing exports from AF to NA, and SA.

The linear regression trends suggest that in about 2006 CH over took rAP as the number three export destination for AF’s petroleum exports, and, CH could eventual overtake EU as the number two export destination in about 2018.  It would take much longer for CH to overtake NA as the number destination because the trend is also from increasing exports to NA albeit at a slower rate of increase that the rate of CH’s increase.

Finally, Figures 11 and 12 show the relative changes in AF's import sources and export destinations, respectively, as a percentage of AF's total exports or imports in the years 2000 and 2010, and, as predicted in 2021, from the linear regression trend lines shown in Figures 9 and 10.

Figure 11 illustrates the trends for increased imports from EU, rAP and NA and steeply declining imports from the ME. 
In 2000 the ME was providing 77 percent of AF’s imports, and by 2010 that number was down to 37 percent.  A continuation of that trend will make ME a still important source at 16 percent in 2021, but in second place behind EU.  EU provided 19 percent of AF’s imports in 2000 but 36 percent in 2010, with an extrapolation to 47 percent in 2021.  NA and rAP were negligibly small import sources in 2000, but that was up to 8.4 and 12 in 2010, and the trend is for further increases to 11 and 15 percent in 2021—not too far behind ME.

Figure 12 illustrates how AF’s petroleum export destinations away from EU and rAP and towards NA and CH, and to a lesser extent, SA.

In 2000, overwhelmingly, AF’s exports went to EU (44%), NA (30% ) and rAP (16%), with CH a distant fourth (5.6%).  By 2010, CH (17%) had surpassed rAP (11%) and NA (33%) was receiving nearly the same proportion of AF’s exports as EU (33%).  By 2021, the trend is for both NA (39%) and CH (28%) to have surpassed EU (23%), and, SA (6%) is predicted to be receiving more of AF’s petroleum than rAP (3%).

Summary and Conclusions
AF’s petroleum exports of 2 to 3 bby over the last decade (Figure 2) has accounted for about 16-18 percent of the inter-regional global petroleum export pool (Figure 4).  Over this period Africa’s petroleum inter-regional imports reached a peak of about 0.5 bby or 3 percent of the global import/export pool in 2007, and then dropped precipitously to 0.3 bby 1.8 percent of the global ppol in 2010.  The drop appears to be due a large decrease in crude oil going from the Middle East to Africa.  Increasing petroleum product imports, mainly from Europe, have partially offset the declining imports. 

In the past decade, Africa's inter-regional exports of petroleum have shifted away from Europe and the remaining Asia Pacific region (which excludes China and Japan), towards North America, China and to a much lesser extent, South America (Figure 12).  If these trends continue, by 2021, Africa’s number one and two export destinations would become North America and China, respectively, with Europe in third place.  
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Next time, I head north to examine Europe’s petroleum Export and Import Trends. 

Sunday, April 1, 2012

Part 4: Inter-Regional Trade Movements of Petroleum to and from South America

In Part 1, I introduced my abbreviations, data bases and analysis methods, and in Part 2, I presented the global trends.   Part 3 presented the inter-regional trade movements to and from North America. 

Some comments I have received in response to the previous parts suggests that some people are having trouble comprehending what I am trying to do in this series.  So, I will go over some introductory material again and better explain some of the finer points of this analysis.

My main focus here is looking at the movements of petroleum between nine major global regions:

1) North America (NA)
2) South America (SA)
3) Europe (EU)
4) former Soviet Union (FS)
5) Middle East (ME)
6) Africa (AF)
7) China (CH)
8) Japan (JP)
9) Asia-Pacific remainder (APr)

I selected these regions because the yearly BP’s “Statistical Review of World Energy” (“BP review”), has either directly presented the inter-area movements between these regions, or, I can derive inter-regional movements between these regions from this data. 

This type of data has been reported in the BP review every year since 2000, but to the best of my knowledge, no one has ever tried to look at and publically report an analysis of the trends in these data over time.  The BP review and the EIA also report yearly total, crude and product imports and exports, and I also looked at these data.

Note that I am looking at the trade movements of petroleum, i.e., inter-regional imports and exports, between these regions.  Therefore, for example, if I am talking about North American inter-regional imports and exports, then I am not talking about movements between countries within that region. 

The imports and exports of petroleum between the USA and Canada, USA and Mexico or Mexico and Canada, are all what I have called intra-regional trade movements within North America.  It is the imports and exports of any of these three countries within the North American region, to or from any other country in any of the other eight regions is what I call an inter-regional trade movement.

With the exception of North America (NA), the BP review doesn’t provide enough data to specifically account for the intra-regional trade movements.  For instance, to assess this for Europe (EU) one would have to have all the exports and imports of petroleum between all of the countries within EU.  The same would be the case for AF, SA, FS, APr, and ME.  As explained in Part 1, I can get an indirect estimate of intra-regional trade movements by looking at the difference between gross import and export numbers reported by the EIA and the inter-regional numbers from the BP reviews.  However, as further explained in Part 3, when I applied this to NA the intra-regional import and exports didn’t agree particularly well with the intra-regional imports and exports reported in the BP review data.  This suggests that this difference method can only provide a very rough estimate of intra-regional trade movements.

Note that even though each of the nine regions are either net importers or net exporters of petroleum, each one of these regions still likely have both inter-regional imports and exports.  For example, even though North America (NA) is a strong net importer, it still exports petroleum.  Just because NA’s inter-regional exports are trending upwards and imports are trend downwards, doesn’t mean that it has become a net exporter, although if this trend continued long enough, and there was still petroleum production, then NA could become a net exporter.  That is a story for another series.  Likewise, even though South America (SA) is a net exporter, it still also imports a significant amount of the petroleum it consumes.  South America presently exports more petroleum than it imports, but if there were a trend in the direction of less exports and increasing imports then I think you can see that SA could become a net importer. 

To be more nuanced, the BP trade movement data, and further derivation of regional data from the present study, allows me to examine the specific relationship of petroleum trade movements between each of these nine regions.  For example, it could be that SA is or becomes a net importer of petroleum with respect to Africa, or maybe some day North America, while at the same time being a net exporter of petroleum to China or the remaining Asia Pacific regions.

Note that this study does not directly assess the total size of the global or regional petroleum export/import pools going forward.  I have already did that kind of study in the past, based on an Export Land Model using a nonlinear least squares analysis of the Hubbert Equation of the petroleum production and consumption data elsewhere reported in the BP review (see http://crash-watcher.blogspot.com/2011/04/estimating-end-of-global-petroleum.html and subsequent parts). 

I think that the present series is interesting in its own right, because as I said, I haven’t seen anyone, publically at least, look at the trends of these trade movement and analyze their implications.  However, in the future, I would like to I add the results of the present study to an expanded version of my previous Export Land Model analysis.  But again, that is a series for another day.

Well, with this further review and explanation out of the way, let’s get on with the results for South America.

South American Gross and Inter-regional Export and Import Trends
Figure 1 presents SA’s total petroleum consumption (i.e., both domestic and imported),  and, the gross and inter-regional imports of total petroleum, crude oil and petroleum products, all from the data reported by the EIA or BP. 


As you can see in the figure, the BP and EIA total consumption numbers (red circles and squares at the top) while slightly differing in value, both illustrate the long-term trend of increasing petroleum consumption in SA since at least 1985.  After a plateau from 1999-2003, petroleum consumption has taken off and was about 2.2-2.3 bby in 2010.

Total gross petroleum imports (open red circles) has been steadily rising since 1986, the first EIA reporting year.  In 2008, the last EIA reporting year, gross petroleum imports of 1.3 bby provided for about 60% of total consumption.  The total inter-regional petroleum imports (open red squares) were much lower ranging from 0.4 to 0.6 bby from 2000 to 2010.  That is about 27% of total consumption in 2010, implying that there is a relative larger amount of intra-regional trade movements of petroleum in SA (about 0.8 bby, from Figure 5 below).  I suspect that the intra-regional trade movements of petroleum would largely involve exports from Brazil or Venezuela to other countries in SA, which by the way, includes Central America.   

SA’s gross crude imports (open brown circles) have slowly, but steadily increased from 0.56 to 0.7 bby from 1986 to 2008, but, the inter-regional imports (open brown squares) have been declining from 0.3 to 0.15 bby from 2000 to 2010.  This would suggest a trend of increased refining of crude oil within SA.

SA’s gross (open green circles) and inter-regional petroleum product imports (open green squares) are both increasing quite dramatically: gross petroleum product imports increased from 0.18 to 0.6 bby from 1986 to 2008, while inter-regional petroleum product imports increased from 0.08 to 0.43 bby from 2000 to 2010.  Again the difference between gross and inter-region product imports implies that there are substantially amounts of intra-regional petroleum product imports (see Figure 6 below).

Figure 2 presents SA’s total petroleum production (i.e. domestic production, blue circles and squares for EIA and BP data, respectively), crude oil production (purple circles), and the gross and inter-regional total petroleum, crude and petroleum products exports. 

I kept the vertical scales of Figures 1 and 2 the same as each other to better illustrate that SA is a net exporter of petroleum.  Figure 2 illustrates that until about 1998 a large fraction of SA’s production was crude oil (purple circles).  Thereafter, crude production rate has flattened out, even though total petroleum production continues to increase, with a prominent dip in 2001-2003.

SA's total gross petroleum exports (open blue circles) have oscillated with increasing amplitude since the late 1990s, but the recent trend is a peak in 2006 at 2.2 bby and down trend in 2007-2008.  The inter-regional total petroleum exports (open blue squares) have not oscillated as widely, and the decade long trend is up, but for last 5 years, inter-regional total exports are flat at about 1.3-1.4 bby.

The gross total petroleum export rate oscillates because both gross crude and petroleum product export rates have oscillated.  For instance, gross crude oil exports (brown open circles) peaked once in 1998 and then again in 2005.  In comparison, the inter-regional crude oil exports (brow open squares) is much more steadily increasing, except for a dip in 2003.  For instance, gross petroleum product exports (green open circles) peaked in 2001 and again in 2006, with a down trend since then.  The inter-regional petroleum product exports also appears to have peaked in 2006.

In part 2 (Figures 2 and 3), I showed that the total global import and export pools of petroleum showed signs of plateauing and peaking around 2006-07, and so it is interesting for me to look at regional trends relative to these flat to diminishing global import and export pools. Note that the gross and inter-regional petroleum import/export pools are not the same size.  For example, from Figure 2 in Part 2, in 2008, the total gross global petroleum import pool was 22.6 bby, while the total global inter-regional petroleum import pool was 17.1 bby.

Figure 3 shows SA's imports relative to the respective total gross and inter-regional global petroleum import pools. 

The gross and inter-regional crude oil imports as a percentage of the global import pool are both strongly trending downwards while petroleum product imports are strongly trending upwards. 

The sum of these two opposite trends adds up to the gross total petroleum imports, as a percentage of the global import pool, being about 6 %, and slightly trending downwards, while the total inter-regional petroleum imports, being about 3% of the total global pool, is trending upwards.  Basically, the downward trend in gross crude oil imports is stronger than the upward trend in gross petroleum product imports, but the upward trend inter-regional product imports is stronger than the inter-regional downward trend in inter-regional crude oil imports. 

These details are somewhat confusing I know, so keep in mind the broad picture that both the EIA’s gross import data and the BP’s inter-regional import data, suggest less importation of crude oil and more importation of petroleum products.  And, that SA is a relatively small drawer, 3%, of the global import pool.

Figure 4 shows SA's exports relative to the respective total gross and inter-regional global petroleum export pools, which, of course, is about the same as the global import pool.   Also analogous to the imports trends shown in Figure 3, these relative export amounts are expressed as a percentage of the total gross export pool and the total inter-regional export pool, and, these total pool sizes are different: e.g., 23 bby of gross exports in 2008 versus 17.1 bby inter-regional exports in 2008. 

I kept the same vertical scale as used in Figure 3 to make the point clear that SA’s petroleum exports greater than its imports—that is a net exporter. 

SA’s gross total petroleum exports (blue open circles), as a percentage of the total gross petroleum export pool (blue circles), appears to have lots of oscillation: an absolute peak in 1997 at 9.8 %, dropping to 8.1% in 2004, then back up to 9.2%, before dropped back down to 8.2% in 2008, the last reporting year for the EIA. 

The absolute peak in 1997 is largely due to an absolute peak in gross crude exports (brown open circles) in 1997-98.  A peak in gross petroleum product exports (green open circles) helped to slow the decline in total gross exports, as did another spike in crude oil exports in 2005. 

The inter-regional petroleum export trend is calmer.  Total interregional petroleum exports (open blue squares) have ranged from 7-8 percent of the total global petroleum export pool.  Interregional exports of crude oil (open brown squares) dipped to a low of 4.7% of the total export pool in 2003 and has steadily increase since ten to 5.8% in 2010.  Inter-regional petroleum product exports (open green squares) peaked in 2004, at 3% and has steadily declined since then to 2% in 2010.

South American Intra-regional Export and Import Trends
The difference between the gross and inter-regional imports or exports, shown in Figures 1 and 2, respectively, should correspond to intra-regional movements of petroleum.   For the reasons presented in Part 3, I think that these differences are only rough estimates of intra-regional imports and exports.  But still, I will show the differences here, with some brief commentary.

Figure 5 shows the differences between the gross and inter-regional total, crude oils and petroleum product imports, which should equal the intra-regional values for these quantities. 

Crude oil intra-regional imports (brown triangles) have increased, while product imports (green triangles) have declined, resulting in a pretty flat trend in total intra-regional petroleum exports (red triangles) at about 0.8 bby.

Figure 6 shows the differences between the gross and inter-regional total, crude oil and petroleum product exports, which should equal the intra-regional export values for these quantities. 

Crude oil intra-regional exports spiked in 2005 and intra-regional petroleum product exports have steadily declined, leading to a total intra-regional petroleum export trend with a spike in 2005 and overall downward trend to 0.56 bby by 2010.

Trade movements of total petroleum between Sorth America and other regions
Figure 7 show the specific quantities, in bby, of petroleum imported to SA FROM each of the eight other regions.  For reference, Figure 7 also shows the sum of SA's total inter-regional petroleum imports from all eight of the other regions (black "Xs"), which is the same as presented in Figure 1 (red open squares).

SA's total inter-regional petroleum imports were quite steady at 0.4 bby from 2000 to 2005 and then started to increase.  This appears to be mainly due to an increase in imports from NA and AF (especially the spike from AF in 2005) and to a lesser extent from EU and APr. 

At the same time, imports from the ME and FS have fallen.  In 2000 ME was the top import source, in 2010 NA is the top source with AF in second, and APr in third; ME is tied with EU in fourth or fifth place and FS is essentially at 0 (i.e., 0.005 bby).

Figure 8 shows petroleum export from SA TO each of the eight other regions and again for reference, I show SA’s total exports (black “Xs” corresponding to the blue squares in Figure 2).  Note the larger vertical scale compared to Figure 7, illustrating SA’s position as a net exporter.

Figure 8 illustrates the upward trend in SA’s petroleum exports, and that NA is by far the major export destination for SA’s  petroleum.  However, after peaking at 1.1 bby to NA in 2005, exports to NA have since declined to 0.85 bby.   This quantity is still about 3 times more than the 0.29 bby of petroleum that NA sends to SA (Figure 7), so SA is still a net petroleum exporter with respect to NA. 

EU has also been a substantial destination for SA’s petroleum exports at about 0.1 bby, but, recently CH and APr risen to replace EU as the number two and three destinations.  

Figures 9 and 10 present the same data as shown in Figures 7 and 8, respectively, but expressing SA's petroleum imports or exports, to or from each of the eight regions, as percentages of the total global inter-regional petroleum import/export pool (of course, on a global scale inter-regional imports and exports are the same) .  For reference, I also show SA petroleum imports and exports as percentages of the global petroleum import/export pool (“Xs” right vertical axis; note the different scale). 

Additionally, I have taken all of these data and made linear extrapolations of the 2000 to 2010 data (via linear regression analysis) out to 2021. 

Figure 9 nicely shows the import trends discussed in the context of Figure 7: increasing amounts of petroleum imports from NA, AF, EU and APr, and decreasing imports from ME and FS.

Indeed, the linear regression trends suggest that imports from ME and FS are pretty well ending, and going forward, SA will look to NA, AF, APr and EU in that order for its imports.

Likewise, Figure 10 nicely shows the export trend discussed in the context of Figure 8:  declining exports from SA to NA, increasing exports from SA to CH and APr, and a slight uptrend in exports to EU.  SA’s total petroleum exports have been fairly stable at 8% of the total export pool.

The linear regression trends suggest that CH is about to overtake EU as the number two export destination of SA’s petroleum, and that APr would overtake EU after 2021. Comparing Figures 9 and 10, if the linear extrapolations are accurately predictive, then NA would become a net exporter to SA in about 2021. 

Finally, Figures 11 and 12 show the relative changes in SA's import sources and export destinations, respectively, as a percentage of SA's total exports or imports in the years 2000 and 2010, and, as predicted in 2021, from the linear regression trend lines.

Figure 11 illustrates the trends for increased imports from NA, AF, APr, EU, and even CH which is made almost the same relative contribution (6.2%) to SA’s imports as EU’s (6.3%) and CH is predicted to make a larger contribution than EU by 2021. 

NA’s growing role as an import source to SA is also quite clear in Figure 11.  SA looked to NA for 30% of its petroleum imports in 2000, and 50% in 2010, and the linear regression trend line predicts 62% in 2021. 

Also prominent in Figure 11 is the disappearance of ME and FS as petroleum import sources.  From 38% and 15%, respectively, of SA’s imports in 2000, to 7 and 1% respectively, in 2010, and a prediction of zero well before 2021.  ME and FS went from SA’s number one and number three import sources in 2000 (NA was number two) to relatively minor players in 2010, and likely non-players in the years to come. 

Figure 12 illustrates how SA’s petroleum export sources have diversified since 2000, and how this trend will likely continue in the future. 

In 2000, overwhelmingly, SA’s exports went to NA (88%) and EU (8%).  But, by 2010, exports to NA was down to 66%.  EU as a destination for SA exports increased slightly, to 9% by 2010.  However, by 2010, CH was receiving 14% and APr was receiving 11% of SA’s exports.  By 2021, exports to NA are predicted to be down to 39%, with CH, APr and EU receiving 26%, 16% and 17% of SA’s exports, respectively.

Summary and Conclusions
For the last decade, South America’s exports of 1.1 to 1.3 bby of petroleum (Figure 2), accounted for about 7-8 percent of the global petroleum export pool (Figure 4).  Over the same period, however, South America has been increasingly importing petroleum from other regions of the world.  From 2000 to 2010, South America’s petroleum imports increased from 0.4 bby to 0.6 bby, a fifty percent increase (Figure 1).   Imports of crude oil are trending downward while imports of petroleum products are trending upwards (Figure 3).   

In the past decade, North America and Africa, as petroleum import sources to South America, have increased, while the Middle East and Former Soviet Union as import sources have gone down substantially (Figure 9).  Over the same period, North America as petroleum export destination for South America petroleum has gone down, while China, other Asia Pacific countries (except Japan), and Europe have gone up (Figure 10).  If these trends were to continue, South America may one day become a net importer of petroleum from North America and a strong exporter to China and the other Asia Pacific countries (Figures 11 and 12).  From a South American perspective, these trends might be seen as a desirable diversification of South American petroleum export destinations.  From a North American perspective, this trend might be viewed as a redistribution of South America’s petroleum wealth away from North America, and towards China and other Asia Pacific countries. 
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Next time I will cross the Atlantic and examine Africa's petroleum Export and Import Trends.