Oil and Gas to re­main most vi­tal en­ergy source till 2040: Opec

The Gulf Today - Business - - FRONTPAGE -

ABU DHABI: The lat­est edi­tion of the OPEC World Oil Out­look pre­dicts oil will re­main the world’s largest source of en­ergy over the next two decades, de­spite the in­creas­ing im­por­tance of re­new­ables.

Re­leased in an ex­clu­sive brief­ing to se­nior in­dus­try ex­ec­u­tives at the Abu Dhabi In­ter­na­tional Petroleum Ex­hi­bi­tion and Con­fer­ence, ADIPEC, the lat­est edi­tion of the World Oil Out­look fore­casts that oil will sup­ply just over 27 per cent of world­wide en­ergy needs in 2040, while nat­u­ral gas will see its share at slightly more than 25 per cent.

The sce­nario would see de­mand grow from 95.4 mil­lion bar­rels per day, in 2016, to reach 111.1 mil­lion bar­rels per day by 2040, with the global econ­omy grow­ing by an av­er­age of 3.5 per cent per year dur­ing that time. Meet­ing this de­mand would re­quire an over­all in­vest­ment of around US$10.5 tril­lion across up­stream, mid­stream and down­stream op­er­a­tions.

In his in­tro­duc­tion to the re­port, Opec Sec­re­tary-gen­eral, Mo­ham­mad Barkindo, noted the 2017 out­look was more pos­i­tive than last year, partly thanks to oil ex­port­ing na­tions’ ef­forts to sta­bilise the mar­ket.

“The past year has been an his­toric one for Opec and the global oil in­dus­try,” Barkindo said. “Since pub­li­ca­tion of the World Oil Out­look, in early Novem­ber last year, the oil mar­ket has un­der­gone sig­nif­i­cant change and tran­si­tion. It has been a pe­riod where the re­bal­anc­ing of the global oil mar­ket has gath­ered vi­tal mo­men­tum, buoyed by a num­ber of im­por­tant fac­tors.” How­ever, while prospects for the in­dus­try are strong, the World Oil Out­look pre­dicts de­mand for oil will grow more slowly than the over­all de­mand for en­ergy. Re­new­ables will see the fastest rate of an­nual growth, at 6.8 per cent per an­num, although their over­all share of the en­ergy mix is only ex­pected to reach 5.4 per cent by 2040 due to their lower start­ing base.

“Along­side an ever-ex­pand­ing global pop­u­la­tion and the crit­i­cal im­por­tance of re­duc­ing en­ergy poverty, these growth rates mean en­ergy de­mand is ex­pected to in­crease by close to 100 mil­lion bar­rels of oil equiv­a­lent a day be­tween 2015 and 2040,” Barkindo said.

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