World oil demand to soar - but more slowly

Washington, USA - World oil demand will soar over the next two decades but more slowly than experts expected a year ago because high crude prices will take a toll, the U.S. government’s top energy forecasting agency says.

World energy consumption will grow 50 per cent by 2030, the Energy Information Administration said in its new annual long-term forecast. It said demand from developing countries will surge 85 per cent compared with a 19 per cent increase in industrialized countries.

The EIA also said consuming countries will rely more on OPEC because of low production elsewhere.  "We see strong growth in energy consumption," said Guy Caruso, who heads the Energy Department’s forecasting arm. "The vast majority of that growth will be in the emerging markets," particularly in China and India, he said.

Caruso said most growth in energy demand will be in transportation fuels as consumers in developing countries purchase more vehicles.

World oil demand in 2010 will average 89.2 million barrels per day, the agency predicted, dropping its forecast by 1.5 million bpd from last year due to higher prices.

In China, the oil use forecast was cut 600,000 bpd to 8.8 million bpd. That still would be up 10 per cent from demand of 8 million bpd forecast for this year.  The EIA forecast for India’s oil demand in 2010 was unchanged at 2.7 million bpd.

The EIA forecast average world oil demand of 112.5 million bpd in 2030, down 5.1 million bpd from last year’s estimate. The forecast was cut based on prices predicted last summer, not June’s run-up in oil to nearly $140 a barrel.

Unconventional resources (including oil sands, extra-heavy oil, biofuels, coal-to-liquids, and gas-to-liquids) from both OPEC and non-OPEC sources are expected to become increasingly competitive. World production of unconventional resources, which totaled only 2.5 million barrels per day in 2005, will increase to 9.7 million barrels per day in 2030, accounting for 9 percent of total world liquids supply in 2030 on an oil equivalent basis.

Biofuels, including ethanol and biodiesel, will be an increasingly important source of unconventional liquids supplies, largely because of the growth in U.S. biofuels production. The United States accounts for nearly one-half of the rise in world biofuels production, at 1.2 million barrels per day in 2030. 

Not surprisingly, World carbon dioxide emissions continue to increase steadily, from 28.1 billion metric tons in 2005 to 34.3 billion metric tons in 2015 and 42.3 billion metric tons in 2030 - an increase of 51 percent over the projection period.

With strong economic growth and continued heavy reliance on fossil fuels expected for most of the non-OECD economies, much of the increase in carbon dioxide emissions is projected to occur among the developing, non-OECD nations. In 2005, non-OECD emissions exceeded OECD emissions by 7 percent. In 2030, however, non-OECD emissions are projected to exceed OECD emissions by 72 percent.

Full details on the report are available here.

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