The Price Elasticity of U.S. Shale Oil Reserves
We formulated a model of shale oil development that identifies how much of the U.S. resource base is likely to be economically viable at various price levels, and what share of potential drilling sites are likely to be exploited. The analysis is driven by the lognormal variability in productivity of individual wells.

released: July 2017; contact author(s): Thomas Lee, James L. Smith

Inside the Crystal Ball: New Approaches to Predicting the Gasoline Price at the Pump
This paper provides a comprehensive analysis of the forecastability of the real U.S. price of gasoline, drawing on state-of-the-art regression-based forecasting methods.

released: July 15, 2015; contact author(s): Thomas K. Lee

Incorporating International Petroleum Reserves and Resource Estimates into Projections of Production
This paper describes EIA's petroleum reserves and resource assessment methodology, comparable long-term outlooks' approaches to resource uncertainties, production decline rates, resource terminology, and the available estimates.

released: June 7, 2011; contact author(s): John Staub

Projecting the scale of the pipeline network for CO2-EOR and its implications for CCS infrastructure development
This paper looks at the required infrastructure construction to support NEMS projections of CO₂ use for oil recovery.  It considers the scale of the infrastructure and potential implications for adaptation of it for CO2 transport for CCS.

released: October 25, 2010 | author(s): Mathew Tanner

The Challenge of Achieving California's Low Carbon Fuel Standard
Paper looks at California’s Low Carbon Fuel Standard (LCFS) reductions in the carbon intensities (CIs) of both gasoline and diesel transportation fuel types and compliance scenarios envisioned by CARB to meet the LCFS schedule.

released: May 24, 2010; revised July 16, 2010; contact author(s): Peter Gross

On Inaccuracies in a Published Journal Article
The article referenced above analyzes the renewable electricity results from the Reference case scenarios of several successive historical editions of EIA's Annual Energy Outlook (AEO). It makes a retrospective analysis of these results, infers (incorrectly) that the NEMS model is fundamentally flawed, and on that basis calls into question its utility for policy analysis.

released: May 2016; contact author(s): Chris Namovicz, David Daniels

The Flight Paths for Biojet Fuel
Jet fuel is a 22-billion-gallon per year market in the United States and about 80 billion gallons per year worldwide. Biofuels have made inroads into gasoline and diesel fuel supplies, but are only beginning to enter the jet fuel market. "Biojet" is a term that describes fuel made from renewable, biologically-derived raw materials and, once blended with petroleum jet fuel, is suitable for use in an unmodified jet engine. "Alternative jet fuel" is a more general term that describes jet fuel blending components made from biogenic and fossil (e.g. coal, natural gas, industrial waste gases, or the non-biogenic portion of municipal solid waste) feedstocks. There are several reasons for interest in biojet. Airlines and the U.S. Department of Defense are looking to biojet to diversify fuel supplies and lower fuel costs in the long run. As with other transportation modes, greenhouse gases are a concern for aviation. The International Civil Aviation Organization (ICAO), the United Nations body that sets standards and recommended practices for international aviation, has set a goal for international aviation to achieve carbon-neutral growth from 2020.

released: October 9. 2015; contact author(s): Tony Radich

Issues and Methods for Estimating the Share of Ethanol in the Motor Gasoline Supply
This paper describes publicly available fuel ethanol data and suggests methodologies to estimate the percentage of ethanol used in the United States gasoline supply. These methods, which use historical U.S. Energy Information Administration (EIA) survey data and information from other sources, involve calculations based on motor gasoline and ethanol production, net imports, and inputs into refineries and blenders.

released: October 13, 2011; contact author(s): Tony Radich and Sean Hill

The Resource Hierarchy Relationship
Estimates of technically recoverable resource (TRR) are a necessary part of any long-term projection of future hydrocarbon production. TRR can be related to economically recoverable resources (ERR) and original resource in-place (ORIP) by the following relation: 0 <= ERR <= TRR <= ORIP. It is therefore possible to indirectly bound TRR within the context of ERR and in-place estimates, as opposed to estimating it directly.

Estimates of TRR have an implicit or explicit relationship to price, and the accompanying application of technology or industry practice allowed by that price. TRR can be estimated without solving for the upper constraint of total resource size, but a more thorough understanding of the total resource equation is obtained by including the geologically based upper limit.

released: September 27, 2015; contact author(s): Troy Cook

Improving Well Productivity Based Modeling with the Incorporation of Geologic Dependicies
The U.S. Energy Information Administration (EIA) utilizes supply-side modeling of well-level performance measures quantified at the county level for resource plays. Well performance, however, does not depend upon political boundaries. Aligning well-productivity with underlying geologic dependencies will improve production projections by better quantifying the area, and the well-performance in that area, of potential future development.

The choice of geologic dependencies can be as flexible and numerous as time and resources permit, or a derivative product of multiple dependencies. The summation of the well-performance and area is also a reasonable method to estimate an amount of resource that might be recoverable under a given set of technological and economic conditions.

released: October 14, 2014; contact author(s): Troy Cook and Dana Van Wagener

Quantifying Drilling Efficiency
This paper examines the methods used to measure drilling efficiency and the difficulties encountered when using various data sources. The analysis exames the technologies used before, during, and after rotary rig iperation which shape overall productivity results.

released: August 13, 2010; author(s): John Cochener

Global Natural Gas Overview: A Report Prepared by Leidos, Inc., Under Contract to EIA
The attached report, prepared by Leidos, Inc., under contract to EIA, provides a broad overview of today's global natural gas markets, possible drivers of the evolution of the global gas market, and a high level overview of select economic theories that may be applied to describe basic market interactions in current and future global natural gas markets.

released: August 26, 2014; contact author(s): Angelina LaRose

The Information Role of Spot Prices and Inventories
Using a rational expectations approach, we show why and how differences in beliefs, as well as the volume of speculative futures trading, may vary across commodities and through time. We demonstrate that equilibrium differences in beliefs are determined by characteristics of the underlying commodity, including storage costs, the amplitude of shocks, the accuracy of information available to informed investors, the numbers of informed and uninformed traders, and the elasticity of demand and supply. We also demonstrate that passive investors magnify equilibrium differences in beliefs and expand the scope for financial speculation--even though they do not themselves speculate. Finally, we argue that fundamental determinants of speculative futures trading may have been misinterpreted by some as "excessive" speculation in the energy markets in recent years.

released: June 24, 2014; contact author(s): Thomas Lee

Are there Gains from Pooling Real-Time Oil Price Forecasts?
The answer depends on the objective. The approach of combining five of the leading forecasting models with equal weights dominates the strategy of selecting one model and using it for all horizons up to two years. Even more accurate forecasts, however, are obtained when allowing the forecast combinations to vary across forecast horizons. While the latter approach is not always more accurate than selecting the single most accurate forecasting model by horizon, its accuracy can be shown to be much more stable over time. The MSPE of real-time pooled forecasts is between 3% and 29% lower than that of the no-change forecast and its directional accuracy as high as 73%. Our results are robust to alternative oil price measures and apply to monthly as well as quarterly forecasts. We illustrate how forecast pooling may be used to produce real-time forecasts of the real and the nominal price of oil in a format consistent with that employed by the U.S. Energy Information Administration in releasing its short-term oil price forecasts and we compare these forecasts during key historical episodes.

released: February 14, 2014; contact author(s): Thomas Lee

Contango in Cushing? Evidence on Financial-Physical Interactions in the U.S. Crude Oil Market
While there has been considerable focus, especially in the aftermath of the 2007-08 oil price spike, on the role of financial speculators in influencing oil prices, a question that lies at the heart of this debate -- how oil futures trading is related to spot oil prices — remains unresolved. A financial speculator who expects future oil prices to rise and wants to take a speculative position based on this expectation would typically go long in financial futures contracts. An index investor who wants to invest in oil will take a similar long position in futures contracts, which would be rolled over periodically. If such speculative or investment activity increases the futures price sufficiently relative to the prevailing spot price, a rational market response would be for arbitrageurs to step in to buy oil in the spot market and store it while simultaneously selling futures.

released: March 23, 2012; contact author(s): Thomas Lee

Implications of Changing Correlations Between WTI and Other Commodities, Asset Classes, and Implied Volatility
Crude oil price movements are constantly changing as the market reacts to new information regarding current production, consumption and inventory levels of crude oil and petroleum products. Oil prices are also affected by changes in the market’s expectations of the future supply and demand balance. Depending on market conditions and sentiment, different time periods can have news and events related to either supply or demand issues as the dominant factors dictating price movements. The analysis presented here attempts to identify time periods when crude oil prices are responding more to either supply or demand, relative to the other, by examining the magnitude and sign of the correlation of crude oil prices against other commodities and asset classes.

released: March 23, 2012; contact author(s): James Preciado