A focus on the future of energy
THE Emirates Centre for Strategic Studies and Research recently held its 18th annual Energy Conference, which focused on energy a term that bears a lot of meanings and determines the future of the world at a time when it sparks unending debate over its current and future prospects.
During the conference, a speaker highlighted the sweeping changes witnessed by the world in beginning of the last century, when he wondered what the new world system means, replying that it means political power and generalisation of energy sources.
Therefore, the conference addressed several topics, especially the role of technology in the global energy system and the impact of technological development on the energy industry. The impact of technology on the future of the energy industry was examined from two main aspects, the first of which is technology's contribution to finding alternative to fossil energy source, which would be a tremendous breakthrough in the global economy.
The second aspect is related to the role of technology in increasing the reserves of traditional energy sources by extraction of oil, gas and coal in larger quantities, which is a crucial issue to producing countries.
This year, there are many issues that concern oil and gas producing and consuming countries. These issues are very important to the GCC countries and the future of their economies, especially after the recent release of conflicting reports about the oil industry in the Gulf.
Starting with the Gulf, most Western and GCC experts have agreed not to drop oil prices below $80 (Dh293.60) per barrel, and that the era of cheap oil is gone for good, for several reasons.
First, some countries have, in recent years, developed their oil output from deep waters, where the cost is estimated at $75 per barrel, as the price fall below this level means halting production in these fields, which provide the global market with significant oil quantities. Hence, halting production in these fields will result in a shortage of oil supplies and consequently high prices again. This clearly means that oil exporting countries have only three decades to make the most of their enormous oil revenues to diversify income sources and prepare for the post- oil era.
Second, these conclusions are concerning the promising oil production in the United States, where previous reports show that it would achieve self-reliance by 2020. However, these reports are exaggerated as stated by American experts who attended the conference
The fact, the United States will achieve a major progress in oil and gas production over the next seven years by producing natural gas from shale rock, which has been produced in large quantities in recent years, thus leading to a drop in gas prices to record levels. This will bring about a qualitative shift that will enable the United States to reduce its reliance on imported oil.
The US imported 13 million barrels per day over the past five years, compared to its production of 7 million barrels a day, since its daily consumption was 20 million barrels a day in 2005.
In 2020, US oil production will reach 11 million barrels per day and will import seven million barrels, a reverse image of what the picture would be in 2020 compared to 2005. Yet, it will not be a self reliant on oil and will not turn into an exporter.
Apart from major oil exporters at present, such as the GCC and Opec countries and Russia, other promising countries like Brazil, Australia and some African countries are expected to join the club of oil countries. On the level of consumption, the world oil map will shift towards Asia-which its independence on imported oil is increasing considerably, especially from the Gulf region. In brief, many important topics and issues related to energy were highlighted by researchers from various countries around the world through presentations and work papers.