www.enreport.com

Turkish petroleum prices at the pump are as follows:

• gasoline prices are 4.5 TL/liter (2.54 $/liter), (1.9 €/liter) (9.6 $/gallon)
• diesel prices are 3.9 TL/Liter
• 1 $ = 1.77 TL and 1 € = 2.37 (by the end of Feb 2011)

Practically 2.5$/liter is equivalent to 392 $ /barrel. So what are the implications of this high prices. According to Turkish Petroleum Organization (Petder.org.tr) report for 2011, there are several results.
First of all about prices; The price consists of 1/3 refinery price and 2/3 tax. Therefore a 35% increase in world oil prices is reflected as 13.9% increase at the pump...Below is the table for prices in TL.

The other result is a decreasing consumption of Gasoline and consumer demand towards cheaper and more efficient fuels.
In 2011, Turkish gasoline consumption dropped 5.4 % , this has three reasons
1. People are buying preferring smaller engine size (<1600 cc), due to taxes and expensive oil prices
2. People are chosing diesel cars over gasoline cars since diesel is cheaper, more energy dense (more km/liter) and efficient engine technology.
3. Gasoline cars in Turkey can be retrofitted with LPG units with a cost 600-700$... There are estimated to be a 2.5 million gasoline powered cars with LPG units(2011). Since LPG tax is lower

Therefore, if you buy a car, you hardly give up the car for fuel price reasons. But you try to minimize operating costs (diesel, LPG fuels) despite upfront costs (diesel cars cost more, LPG unit). That is to say, even a 400$/barrel world will not stop the car sales figures but shift the consumer choice for more expensive(in sales prices) but relatively less costly(fuels) to operate cars.

References
Daily official oil prices from EPDK , https://ppbp.epdk.org.tr/Rapor/Akaryakit/Paylasim/RaporSekizFirma.aspx
Daily Exchange Rates from Turkish Central Bank http://www.tcmb.gov.tr/

A graph from the IEA's report WEO 2010 reveals that IEA believes that the world crude oil production (not including NGL or others) has peaked in 2006 or nearby:

Previously, I asked Mr. Fatih Birol, chief economist of IEA in a conference(in 2008) at METU Alumni Association, whether world will see 100 million b/d (current production of crude+ngl+other is hovering around 85-89 mb/d). He briefly described the nuances between crude oil, crude oil+NGL or other associates of crude oil. Then he stated "I don't think so"(for crude oil only). World Energy Outlook 2010 steps further and addresses a peak in crude oil only production as I marked on the graph.
Wikileaks reveal some interesting documents regarding Saudi Production. Sadad Al Husseini retired head of exploration and production for Saudi Aramco, states that Saudi Production can hardly hit 12.5 million b/d and according to documents :

" as he believes that Aramco’s reserves are overstated by as much as 300 billion bbls of “speculative resources.”
the former Aramco board member does believe that a global output plateau will be
reached in the next 5 to 10 years and will last some 15 years, until world oil
production begins to decline." (Wikileaks)

The cable is from December 10, 2007. But there is nothing to confidential about it. Sadad Al Husseini said these things before. He previously to energy bulletin he writes :

"Therefore my answer is: under the current circumstances and outlook, oil is likely to peak at a 95 mmbd plateau by 2015 and can then be sustained well beyond 2020 at increasing real oil prices."(Energy Bulletin)

So are we peaked or are we on the plateou of world oil production? We should better be careful claiming answers to such questions. But it is easier to say that, oil production will suffer from delayed investment. To get a better understanding of oil prices, we should check the storage levels and price trends during the May -driving season-. My personal belief is we are entering another high price cycle unless another economic slowdown happens. It is a risk to write those things openly on the net, since net has a memory. Prices may calm down? I am desperate to see that...

http://www.energybulletin.net/node/9498
http://www.theoildrum.com/node/7102
http://www.wikileaks.ch/cable/2007/12/07RIYADH2441.html

Matthew Simmons' article is the most visited in FP's web site for a couple of days. Before reading his article, as he suggests, check the links in this paragraph:
"The four pieces were Pulitzer Prize-winning author Daniel Yergin's seven-page article in Foreign Policy, energy analyst Michael Lynch's three column op-ed in the New York Times, analyst Edward Morse's essay in Foreign Affairs, and scholar Amy Jaffe's paper published by the Baker Institute at Rice University." http://www.foreignpolicy.com/articles/2009/09/04/oil_spin?page=0,0

There is a very good presentation by Matt Simmons arguing the bad side of cheap oil. The low prices keeps the investments at low levels. Therefore the seeds of another oil shock will be planted soon, if prices do not climb to acceptable levels.

The presentation is available here : http://www.simmonsco-intl.com/files/SPE%20Gulf%20Coast.pdf

This version of the report starts with the criticization of IEA numbers, especially China. Crude Oil production is down by nearly 3 million barrels (not world liquid production). Check the oil demand of OPEC countries! There is a big drop in their demand as well. Also, have a look to the Mexico, UK and Norway.

Report is available here (Peakoil.nl)

"The Oilwatch Monthly is a newsletter that is available free of charge with the latest data on oil supply, demand, oil stocks, spare capacity and exports." (The Oil Drum).


This report is quite useful for getting information about world's prominent oil producers and consumers. It is like an open source, illustrated version of IEA's Oil Market Report. The monthly is prepared by "Peak Oil Netherlands". In this edition, check for Russian, Egyptian, Malaysian and Mexican productions and US, OECD and EU consumptions.
You can download the report from here. Following excerpts are from the intro:

"Instead the cartel is going to focus on reaching 100% compliance with the earlier cuts totalling 4.2 million b/d, between now and its next meeting on 28 of May. So far 80% compliance has been reached, with 3.4 million b/d from 36.08 million b/d total produced last October being cut, resulting in 32.68 million b/d of liquids produced in February 2009. "

"OECD demand in December 2008 was 788,000 b/d lower than in july 2008, OPEC-11 (excluding iraq) was 650,000 b/d lower than in July, and Chinese demand was 687,000 b/d lower. A total decline of more than 2 million b/d, while OPEC in December had only cut production by 1.26 million b/d."

"More recent figures from the Energy Information Administration show that crude oil stocks in the USA increased from 334 million barrels in January to 350 million barrels in February, a level not seen since the beginning of the 1990s. On top of the commercial stocks on land the 50 to 80 million barrels of floating storage in oil tankers on the seas still remain."

Oil Watch Monthly: March 2009
http://www.peakoil.nl/wp-content/uploads/2009/03/2009_march_oilwatch_monthly.pdf