In 2016, global oil reserves are estimated at 2,092 billion barrels and 70 times the current level of 30 billion barrels/year. The US first surpassed Russia and Saudi Arabia and became the world’s largest oil-producing country. World natural gas reserves are estimated at 197.2 trillion m3, in which Russia is the country with the largest reserves. The number of drilling rigs in the world plummeted by 2015 and reached 3,618 rigs due to the fall in oil prices and excess supplies.
In the period of 2013- 2016, the world oil supply fluctuated not much. However, supplies from non-OPEC countries tend to increase. Russia is the largest producer of crude oil in the world, accounting for 12.4% of total production. Since 2010, natural gas production has increased steadily. The United States is the leading country with a 21% share. World oil demand in 2016 world average 95.7 million barrels/day. Of which, North America is the largest consumer. Crude oil is the largest export product in the world, accounting for about 4.8% of global exports. Of which, the Middle East is the largest export sector, with a large proportion, global crude oil imports in 2015 reached USD 803.1 billion with an average import volume of 43.047 thousand barrels/day, up 3.4% from 2014 with the largest import and export volume in the Asia Pacific region.
World crude oil prices have plummeted since mid-2014 to below USD 50 a barrel in early 2015 and continue to bottom in early 2016 (the lowest level in nearly 13 years). Crude oil prices only rallied and exceeded the USD 50/barrel mark after OPEC successfully negotiated with member countries on 11/30/2016. Soon after, the world oil market again received a second agreement when OPEC on 12/10 successfully negotiated with some foreign associations to keep crude oil prices above USD 50/barrel until present. Similar to oil prices, natural gas prices are also falling sharply in early 2016 and rising again in the last months of the year.
Vietnam Oil & Gas Industry is still relatively young and has only just begun to receive the attention of the Government. In 1981 the first gas field in Tien Hai – Thai Binh began to be exploited with the help of the former Soviet Union. Since then, the oil and gas industry has always maintained the leading position in Vietnam’s export as well as contributions to the State budget. The oil and gas industry in Vietnam still maintains export exploitation is the main force so it depends heavily on world oil prices.
The oil and gas industry is an industry that includes many stages not only explored and exploited, but also processed from crude oil into refined oil. Traditionally, the oil and gas industry is divided into three types of activities called upstream, downstream, and downstream. The upstream group consists of geological research, exploration and mining activities. Midstream group includes storage and transport activities, and downstream group consists of processing, processing (refining, petrochemicals, gas) and distribution. These three groups have their own unique characteristics, but they bind together to form a closed loop of a complete industry.
Vietnam’s oil and gas reserves in the period 2010-2016 did not change much. While crude oil reserves accounting for 0.3% of world crude oil reserves, ranking second in Southeast Asia and 28th in the world; gas reserves have increased in 2016. During the period 1986 – 2013, the production of oil and gas has increased considerably, equivalent to 0.5% of crude oil output and 0.2% of total world gas output.
In 2015, the group of oil and gas enterprises had negative growth in net sales compared to 2014. This is because the domestic oil and gas industry is strongly affected by the world oil and gas market; In particular, world oil prices fell sharply and remained low, from an average of USD 93.01/barrel in 2014 to only USD 48.8/barrel in 2015. Low oil prices, higher operating costs than oil sales. In general, businesses in the trade area are severely impacted by other sectors. If oil prices continue to fall sharply, many oil and gas enterprises are exploiting will not offset the cost of losses. At the same time it is impossible to balance the financing to continue investment exploration.
In the coming time, OPEC will cut crude oil production, increasing crude oil prices, which will have a strong impact on the domestic petroleum market; in particular, the oil and gas exploitation of Vietnam is assessed to be stable again