We don't need to look at all countries to analyse the oil export market, but rather mainly Saudi Arabia and Russia which total 41.4% of total world oil exports (SA at 8.7 mbd and Russia at 6.7 mbd exported). Norway is a distant third at 2.9 mbd exported. According to 2004 EIA data.
What is interesting in this article is that it shows exports decline (in the UK example) at consumption increase - production increase. Actually I suppose somewhat obvious.
Saudi Arabia's oil consumption increased by 11% in 2005 -- due to strong economic growth (+6.3%), a growing appitite for SUV's (SUV's are the most popular car in the middle east) and a growing petrochemical complex, and population growth (2.18%). So unless oil production increases 11% then oil exports will decline in the 11% range.
Russia's oil consumption increased 7% in 2005 driven by economic growth (6.0%) and increases in energy usage due to cold weather, and increases in car sales from very low levels.
So looking at the main exporters we are facing about 9% declines in oil exported unless Saudi and Russia slow dramatically and/or alter consumption behavior, or increase production, both of which appear unlikely. Without oil exported there is no secondary market for oil.
Saudi Arabia's oil consumption increased by 11% in 2005 -- due to strong economic growth (+6.3%), a growing appitite for SUV's (SUV's are the most popular car in the middle east) and a growing petrochemical complex, and population growth (2.18%). So unless oil production increases 11% then oil exports will decline in the 11% range.
Note that Saudi production is down, through 6/06, by 5.2% from last year's level (EIA, crude + condensate). So, as predicted, net oil exports being squeezed from two directions--by falling production and by rising consumption.
While Saudi Arabia has 26 million people (5 million of them are guest workers) the very high birth rate means that 40% or so of the population are under 15 so they will not use much oil.
No, what that means is that a very high proportion of the population turns 18 in a given year, and gets a car for their birthday.
The Saudi birthrate is surely an anomaly in terms of classic income-per-capita demographics. It's a rather extreme illustration of the fact that demographic transition is mostly about the emancipation of women.
Income per capita has roughly fallen by 2/3rds since 1974 in Saudi Arabia (population has tripled, the real price of oil is no higher, there hasn't been enough other industry come in to fill the gap).
Saudi Arabia is also dependent on 'shadow water' (the term used to mean the water imported as part of food and other products)- -it doesn't have enough of its own resources.
The country is on the edge of very serious political and social trouble. The combination of widespread religious radicalism, a corrupt ruling class, the absence of any meaningful democracy, and poor prospects for the huge majority of the population under 21 is a lethal cocktail-- precisely what led to Algeria's civil war for example.
Right now, the current high price of oil (and high production) and the ruthlessness of the state security apparatus keeps the lid on. But there is no question the Royal Family has been shocked by the various terrorist attacks, and the incompetence of the Security Forces at defeating them. The security forces themselves are rumoured to be riddled with Islamicist sympathisers.
Whilst Abdhullah remains alive and in power, I don't expect change. He is seen as an honest man, and not personally corrupt. When some of his cousins get to power, the situation may be very different.
Osama bin Ladin may yet see the day when he is welcomed in his homeland as a hero.
India 2004 oil consumption 2,573,000 bpd
India 2005 oil consumption 2,485,000 bpd
One of the developing economies to show a fall in consuption last year. Note that France, Germany and Italy also show falls in crude oil consumption - in part related to de-indutrialisation, but maybe also through introduction of "alternatives"?
Yes, rapid economic growth and slowing oil consumption. I see this as the counter trend to the Export Land Model: Delinking Land. As exports slow, countries will do more with less.
The thing which strikes me from the decline in German oil use is how consistent it is - that is, the delayed impact of price can certainly be seen in the 'spike' around 2001, but in general, Germany has been attempting to reduce oil use.
When you think about it, the easiest answers tend to be the same ones which make Germany the world's largest exporter - a tight focus on efficiency, a hard headed view of costs, and an awareness of the entire cycle of production, from acquiring raw materials to disposing of the waste at the end.
Oil costs Germany money, whereas wind turbines, for example, are planned as a future export product - and with a fully electric rail transport system, it is possible to substitute long haul trucking with rail, using renewable sources such as hydro, wind, solar - to a major extent, this is seen as an engineering problem, something Germans tend to feel very comfortable in dealing with. Not that Germans are blind believers in technology like Americans - merely that Germans believe technical problems can be solved with technical solutions - for example, if solar is only available during the day, then the freight train schedule will simply have to reflect that fact - in American eyes, that is not a solution, it is a failure.
And Germany has been quite rigorous in creating a bio-diesel framework for trucks and farm tractors. At this point, easily 50% of the long haul trucks seem to be using bio-diesel, from the smell they leave behind.
Germans have known that oil is a finite resource for more than a generation, which is one reason peak oil as handled here is not really a major theme, while consistent effots to conserve through higher efficiency and reduced use are seen as a necessity, not something which can be put off until the future.
So now all the Germans have to do is put speed limits on their Autobahns. I think you use something like 3 times as much fuel driving at 200 km/h compared to 100 km/h.
I have read that approximately 97% of the Autobahn has speed limits.
But living between Frankfurt and Stuttgart, more or less along the flat and straight A5, which part of the direct route between Frankfurt Airport and the headquarters of Porsche and Mercedes, I expect this stretch of the autobahn to be one of the last unlimited speed routes in the world. Marketing is critical to selling overpriced vehicles.
Speaking very generally, trucks are only allowed 80 kph (50 mph) and up to maybe 90 kph is tolerated - 100kph is not. And those trucks are increasingly using bio-diesel.
This is not a defense of high speed driving - it is that simply the image of the autobahns is not really the same as the daily reality - most cars driven here are not even capable of 200 kph. But those that can go fast are often driven as fast as they can go - which certainly stands out for those not used to driving in such conditions.
After returning from the U.S., I would guess that the average speed of all traffic (not counting heavy rush hour) is at least as high as in Germany, mainly because of all the trucks doing 80 mph (130 kph).
I don't know what part of the US you went to, here on the west coast we rarely seen any truck do over 65 mph. Most often 60. Washington state in particular has very good policing of the interstate.
I have noticed lately more trucks driving slower (55mph). I assume on orders to save fuel by the bosses.
What is particularly sobering about this post is the long line of double digit decline numbers. One might have been lead to believe by splitting the difference between doomers and cornucopians that decline rates would be much more modest; or, as per ASPO, an overall 2 or 3% decline for an entire province.
It appears Schlumberger's "8%" decline rate is indeed a fact, and perhaps a very conservative one.
If Saudi Arabia and Kuwait follows this trajectory, you'd better be buckled in for a wild ride!
* * *
By the way, WestTexas, is SA production down 5.2%, or is that the decline rate for their Exports?
"By the way, WestTexas, is SA production down 5.2%, or is that the decline rate for their Exports?"
Based on EIA crude + condensate, highest KSA number last year was 9.6 mbpd. 6/06 was 9.1. 12/05 was 9.5 (9.6 to 9.1 is down 5.2%). Some Saudi ministers suggest about 9.0 for August, some suggest 9.2 range.
The annual production decline rate, based on 12/05 to 6/06, was 8.3%.
Based on the 12/05 to 6/06 EIA data, the top 10 net oil exporters, based on estimated consumption, showed about a 9.2% annual decline rate in net oil exports.
You can't use Crude+condensate for production when calculating exports. You have to use all liquids, since consumption is also measured in all liquids.
I used a "fudge factor" for consumption. I assumed that 2006 crude + condensate consumption was about the same as 2004 total liquids consumption, based on the rate of growth in consumption.
The secondary oil market is already most likely in decline -- at a faster rate than total world oil production. The level of world oil production is debated but there should be almost no debate concerning the level of exportable oil. This isn't getting enough coverage.
Any models of oil production should take into account that only exportable oil is traded. There is no way exportable oil is going up with Saudi Arabia and Russia growing like they are. I don't think anyone can pound the table hard enough on this point.
It went up between 2004 and 2005. That's for sure. I used real numbers instead of the estimates you have been using. I used your 11% and 7% consumption increase numbers for SA and Russia to save time. I don't know where you got those numbers. They don't match the trend of the previous 3 years and there is nothing to suggest they will continue if they are true.
A quick calculation using average monthly all liquids production 2004->2005 shows a SA and Russian combined net exports increase of 364,000 bpd.
So yes, there is a way, and you can stop pounding the table.
The 7% number for Russia was estimated by the EIA country studies data on domestic oil consumption for Russia in 2003 (last year historical) and the number for estimated 2004 (first forecasted year). This number actually comes out to 8.65%. I apologize for writing that this was for 2005 -- I wrote the comment up there quickly. http://www.eia.doe.gov/emeu/cabs/Russia/Oil.html
Same method for Saudi Arabia: http://www.eia.doe.gov/emeu/cabs/saudi.html#oil However the EIA only presents Saudi domestic oil consumption in a graphical format. Therefore you have to eyeball the numbers and make a calculation of growth.
I wish I could delete the above comment -- Oil CEO is closer to right on historical. The EIA shows 3% for Russian consumption in the last historical year available (2002 to 2003) at about 3% higher, then forcasts through 2005 with essentially no growth in oil consumption (don't know why?). I transposed some numbers in my calculation -- this data I compiled a while ago.
Saudi is closer to 4% from 00 to 04 according to the EIA data in the EIA.
Using BP's more tame 4.5% and 1.7% consumption increases, you can probably tack on another 200,000 barrels of exported oil from these two countries, bringing the total increase in 2005 to over 500,000 barrels per day.
Yes, but...
How about trying to extrapolate to first half 06? Use bp data for consumption, assum this continues as in 05, then look at published first half production...
with SA down, even with russia up, my guess is that exports are probably flat at best, but maybe down.
Believe me, I'm working on it. I should have something by tomorrow. But we can't just ignore the rest of the world. And also, exports are flat anyway. They've been hovering around 52% of total global production give or take a percent for years.
I had thought that Russia has no reliable oil export data, as crude and refined products leave the country via a huge number of routes. So I am not sure how the EIA is calculating Russian oil exports.
Russia's Institute of Energy Policy's numbers updated through July 2006 show essentially no growth in oil production since mid 2004. see the presentation on this page http://www.energypolicy.ru/enews.php?id=1002255
Going forward, Russia's Institute of Energy Policy in the above link states: "Russian oil production will likely remain flat in the next 10-12 months," (from 7/06 to 5/07 to 7/07) also that Eastern Siberia (which is the only area of Russia that offers significant potential for production increases) "remains too underexplored to become new major Russian oil producing region."
The Russian energy minister stated in 2005 that Russian oil production could peak in 2010, which is consistent with the above presentation. Also note that, through 2010, Russian's oil Russian gas production from two of Gazprom's three major gas producing fields (Urengoy and Yamburg) is set to decline by 30%, from 2004 levels. To the extent coal cannot make up the energy difference, some oil may be diverted to satisify domestic energy needs.
So this evidence points to flat to declining growth in production and exports going forward. The EIA's data shows increasing export growth from Russia in the past three years http://www.eia.doe.gov/emeu/steo/pub/gifs/Slide10.gif but I cannot find forecasts by the EIA for Russian exports -- but if the assessment of Russia's Institute of Energy Policy is accurate then there is not much chance of Russian exports increasing.
A follow up question: is the growth in Saudi Oil consumption sustainable? The median age in Saudi Arabia is 21.4 years, growth in Auto sales in 2005: 10%, balance of trade surplus in 2005: $US120Bn. Saudi Arabia is unlikely to roll back subsidized domestic petrol prices because of potential civil unrest (unemployment rate 25%). Several infrastructure projects are likely planned with the huge current account surplus. see http://www.country-studies.com/saudi-arabia/five-year-plans.html
The expansion of Jubail Industrial City is planned for the next few years, which is, according to Bechtel, the largest engineering project in the world -- a city of 230,000 (up from 90,000 in 1999)based around petrochemical production http://www.bechtel.com/spjubail.htm
Petrochemical production is increasing in Saudi Arabia between 20-25% per year -- due to the goverment's attempts to provide young people with work and the country's strong balance of payments position.
All this points to continued higher domestic oil consumption for Saudi Arabia in the future - -note that Saudi Arabia alone accounts for 23.4% of world oil exports in 2004.
If Saudi Arabia uses domestic oil & gas to produce petrochemicals, which are exported, it may change statistics somewhat. But how is it different than SA exporting oil & gas, which is refined into products elsewhere?
In either case the same amount of oil or gas comes out of the ground and the same amount of products are available to other economies.
From an economic standpoint, it is clearly positive for SA and negative for petrochemical producers that don't have access to resources. However in terms of how it impacts oil & gas export figure it is just a technicality. The statistics capture oil & gas as energy and petrochemicals as "not energy".
Why should this worry people who don't work at or hold shares in Dow Chemical, for example, or large Chinese and Taiwanese petrochem operators?
I agree with you in principle, but your math is incorrect. A particular percentage increase in domestic consumtion does not cause the same percentage decrease in exports. It will cause a export decrease of the same number of barrels, but the percentages are different because they are calculated from 2 unique numbers; the former being the barrels consumed domestically, and the latter being exports.
Ok yeah you are right. My first reaction was that if oil consumption is up 11% oil exports will be down 11%. In the case of Saudi Arabia it is less as a percentage terms, only around -2.6%, using 2004 data.
Math:
SA 2004 production: 10.37 mbpd
SA 2004 exports: 8.37 mbpd
SA 2004 consumption: 2.00 mbpd
Assuming 11% SA domestic consumption growth in 2005 with flat production (2005 EIA not yet available)(never mind that production actually was down in reality):
SA 2005 production 10.37 mbpd
SA 2004 consumption (11% growth): 2.22 mbpd
SA 2004 Exports (prod-consumption): 8.15 mbpd
percentage change in SA exports from 2004 to 2005: -2.7%
Well I guess it always pays to run through the numbers, as there is a material difference in percentage terms.
Ok to update this last math -- because it certainly wasn't obvious to me --
Exports, as a percentage decline, will decline SLOWER than consumption growth as a percentage increase if domestic consumption is lower than 50% percent of total production.
In the case of SA, consumption is 2.0 mbpd and production is 10.37 (2004 data)(about 20%) so continued 11% growth in the near term will affect export growth at significantly lower percentage than 11%.
Russia, since consumption is 2.6 mbpd and production is 9.3 mbpd (ratio of 28%) will also see export declines as a smaller percentage than 7% (current increase in domestic consumption) (my calculation point to Russian exports down 2.7% with 7% consumption growth)
HOWEVER, once consumption reaches 50% of total production, exports decline at faster rate than consumption.
This assumes production is flat -- if production declines that is another story.
What is interesting in this article is that it shows exports decline (in the UK example) at consumption increase - production increase. Actually I suppose somewhat obvious.
Saudi Arabia's oil consumption increased by 11% in 2005 -- due to strong economic growth (+6.3%), a growing appitite for SUV's (SUV's are the most popular car in the middle east) and a growing petrochemical complex, and population growth (2.18%). So unless oil production increases 11% then oil exports will decline in the 11% range.
Russia's oil consumption increased 7% in 2005 driven by economic growth (6.0%) and increases in energy usage due to cold weather, and increases in car sales from very low levels.
So looking at the main exporters we are facing about 9% declines in oil exported unless Saudi and Russia slow dramatically and/or alter consumption behavior, or increase production, both of which appear unlikely. Without oil exported there is no secondary market for oil.
Note that Saudi production is down, through 6/06, by 5.2% from last year's level (EIA, crude + condensate). So, as predicted, net oil exports being squeezed from two directions--by falling production and by rising consumption.
- Saudi production down, consumption up, therefore exports way down
- China imports way up (15%?)
- world production flat
- no apparent shortage of oil on the market.
So there is, necessarily, major demand destruction going on. Where? Africa, India? Are the numbers emerging?Saudi Arabia has 20 million people, and GDP per head of c. $8,000.
US consumes 25 bl per person pa, I would bet the Saudis don't consume a quarter of that per person.
Figure 12 bl/per person/ per annum in Saudi: that equates to 240m bl pa or about 600,000 bl/day so less than 10% of total production.
The picture might be a bit more blurry than that because the domestic petrochemical industry soaks up crude (but exports refined products).
The Saudi birthrate is surely an anomaly in terms of classic income-per-capita demographics. It's a rather extreme illustration of the fact that demographic transition is mostly about the emancipation of women.
Income per capita has roughly fallen by 2/3rds since 1974 in Saudi Arabia (population has tripled, the real price of oil is no higher, there hasn't been enough other industry come in to fill the gap).
Saudi Arabia is also dependent on 'shadow water' (the term used to mean the water imported as part of food and other products)- -it doesn't have enough of its own resources.
The country is on the edge of very serious political and social trouble. The combination of widespread religious radicalism, a corrupt ruling class, the absence of any meaningful democracy, and poor prospects for the huge majority of the population under 21 is a lethal cocktail-- precisely what led to Algeria's civil war for example.
Right now, the current high price of oil (and high production) and the ruthlessness of the state security apparatus keeps the lid on. But there is no question the Royal Family has been shocked by the various terrorist attacks, and the incompetence of the Security Forces at defeating them. The security forces themselves are rumoured to be riddled with Islamicist sympathisers.
Whilst Abdhullah remains alive and in power, I don't expect change. He is seen as an honest man, and not personally corrupt. When some of his cousins get to power, the situation may be very different.
Osama bin Ladin may yet see the day when he is welcomed in his homeland as a hero.
India 2004 oil consumption 2,573,000 bpd
India 2005 oil consumption 2,485,000 bpd
One of the developing economies to show a fall in consuption last year. Note that France, Germany and Italy also show falls in crude oil consumption - in part related to de-indutrialisation, but maybe also through introduction of "alternatives"?
When you think about it, the easiest answers tend to be the same ones which make Germany the world's largest exporter - a tight focus on efficiency, a hard headed view of costs, and an awareness of the entire cycle of production, from acquiring raw materials to disposing of the waste at the end.
Oil costs Germany money, whereas wind turbines, for example, are planned as a future export product - and with a fully electric rail transport system, it is possible to substitute long haul trucking with rail, using renewable sources such as hydro, wind, solar - to a major extent, this is seen as an engineering problem, something Germans tend to feel very comfortable in dealing with. Not that Germans are blind believers in technology like Americans - merely that Germans believe technical problems can be solved with technical solutions - for example, if solar is only available during the day, then the freight train schedule will simply have to reflect that fact - in American eyes, that is not a solution, it is a failure.
And Germany has been quite rigorous in creating a bio-diesel framework for trucks and farm tractors. At this point, easily 50% of the long haul trucks seem to be using bio-diesel, from the smell they leave behind.
Germans have known that oil is a finite resource for more than a generation, which is one reason peak oil as handled here is not really a major theme, while consistent effots to conserve through higher efficiency and reduced use are seen as a necessity, not something which can be put off until the future.
But living between Frankfurt and Stuttgart, more or less along the flat and straight A5, which part of the direct route between Frankfurt Airport and the headquarters of Porsche and Mercedes, I expect this stretch of the autobahn to be one of the last unlimited speed routes in the world. Marketing is critical to selling overpriced vehicles.
Speaking very generally, trucks are only allowed 80 kph (50 mph) and up to maybe 90 kph is tolerated - 100kph is not. And those trucks are increasingly using bio-diesel.
This is not a defense of high speed driving - it is that simply the image of the autobahns is not really the same as the daily reality - most cars driven here are not even capable of 200 kph. But those that can go fast are often driven as fast as they can go - which certainly stands out for those not used to driving in such conditions.
After returning from the U.S., I would guess that the average speed of all traffic (not counting heavy rush hour) is at least as high as in Germany, mainly because of all the trucks doing 80 mph (130 kph).
I have noticed lately more trucks driving slower (55mph). I assume on orders to save fuel by the bosses.
It appears Schlumberger's "8%" decline rate is indeed a fact, and perhaps a very conservative one.
If Saudi Arabia and Kuwait follows this trajectory, you'd better be buckled in for a wild ride!
* * *
By the way, WestTexas, is SA production down 5.2%, or is that the decline rate for their Exports?
Based on EIA crude + condensate, highest KSA number last year was 9.6 mbpd. 6/06 was 9.1. 12/05 was 9.5 (9.6 to 9.1 is down 5.2%). Some Saudi ministers suggest about 9.0 for August, some suggest 9.2 range.
The annual production decline rate, based on 12/05 to 6/06, was 8.3%.
Based on the 12/05 to 6/06 EIA data, the top 10 net oil exporters, based on estimated consumption, showed about a 9.2% annual decline rate in net oil exports.
Any models of oil production should take into account that only exportable oil is traded. There is no way exportable oil is going up with Saudi Arabia and Russia growing like they are. I don't think anyone can pound the table hard enough on this point.
A quick calculation using average monthly all liquids production 2004->2005 shows a SA and Russian combined net exports increase of 364,000 bpd.
So yes, there is a way, and you can stop pounding the table.
Same method for Saudi Arabia: http://www.eia.doe.gov/emeu/cabs/saudi.html#oil However the EIA only presents Saudi domestic oil consumption in a graphical format. Therefore you have to eyeball the numbers and make a calculation of growth.
Saudi is closer to 4% from 00 to 04 according to the EIA data in the EIA.
How about trying to extrapolate to first half 06? Use bp data for consumption, assum this continues as in 05, then look at published first half production...
with SA down, even with russia up, my guess is that exports are probably flat at best, but maybe down.
The export number - 52 - is interesting. Its too late here for me to work this out - oil price go up or down with this number?
right side of page inder publications
first link Statistical Review of World Energy
Russia's Institute of Energy Policy's numbers updated through July 2006 show essentially no growth in oil production since mid 2004. see the presentation on this page http://www.energypolicy.ru/enews.php?id=1002255
It is hard to believe that domestic consumption hasn't risen when auto sales in Russia are growing 6%+ every year and the economy is growth above 7%. http://www.autofieldguide.com/columns/0805strat.html
Going forward, Russia's Institute of Energy Policy in the above link states: "Russian oil production will likely remain flat in the next 10-12 months," (from 7/06 to 5/07 to 7/07) also that Eastern Siberia (which is the only area of Russia that offers significant potential for production increases) "remains too underexplored to become new major Russian oil producing region."
The Russian energy minister stated in 2005 that Russian oil production could peak in 2010, which is consistent with the above presentation. Also note that, through 2010, Russian's oil Russian gas production from two of Gazprom's three major gas producing fields (Urengoy and Yamburg) is set to decline by 30%, from 2004 levels. To the extent coal cannot make up the energy difference, some oil may be diverted to satisify domestic energy needs.
So this evidence points to flat to declining growth in production and exports going forward. The EIA's data shows increasing export growth from Russia in the past three years http://www.eia.doe.gov/emeu/steo/pub/gifs/Slide10.gif but I cannot find forecasts by the EIA for Russian exports -- but if the assessment of Russia's Institute of Energy Policy is accurate then there is not much chance of Russian exports increasing.
The expansion of Jubail Industrial City is planned for the next few years, which is, according to Bechtel, the largest engineering project in the world -- a city of 230,000 (up from 90,000 in 1999)based around petrochemical production http://www.bechtel.com/spjubail.htm
Petrochemical production is increasing in Saudi Arabia between 20-25% per year -- due to the goverment's attempts to provide young people with work and the country's strong balance of payments position.
All this points to continued higher domestic oil consumption for Saudi Arabia in the future - -note that Saudi Arabia alone accounts for 23.4% of world oil exports in 2004.
In either case the same amount of oil or gas comes out of the ground and the same amount of products are available to other economies.
From an economic standpoint, it is clearly positive for SA and negative for petrochemical producers that don't have access to resources. However in terms of how it impacts oil & gas export figure it is just a technicality. The statistics capture oil & gas as energy and petrochemicals as "not energy".
Why should this worry people who don't work at or hold shares in Dow Chemical, for example, or large Chinese and Taiwanese petrochem operators?
Good for SA. Good for me. Right?
Math:
SA 2004 production: 10.37 mbpd
SA 2004 exports: 8.37 mbpd
SA 2004 consumption: 2.00 mbpd
Assuming 11% SA domestic consumption growth in 2005 with flat production (2005 EIA not yet available)(never mind that production actually was down in reality):
SA 2005 production 10.37 mbpd
SA 2004 consumption (11% growth): 2.22 mbpd
SA 2004 Exports (prod-consumption): 8.15 mbpd
percentage change in SA exports from 2004 to 2005: -2.7%
Well I guess it always pays to run through the numbers, as there is a material difference in percentage terms.
Exports, as a percentage decline, will decline SLOWER than consumption growth as a percentage increase if domestic consumption is lower than 50% percent of total production.
In the case of SA, consumption is 2.0 mbpd and production is 10.37 (2004 data)(about 20%) so continued 11% growth in the near term will affect export growth at significantly lower percentage than 11%.
Russia, since consumption is 2.6 mbpd and production is 9.3 mbpd (ratio of 28%) will also see export declines as a smaller percentage than 7% (current increase in domestic consumption) (my calculation point to Russian exports down 2.7% with 7% consumption growth)
HOWEVER, once consumption reaches 50% of total production, exports decline at faster rate than consumption.
This assumes production is flat -- if production declines that is another story.