Nick Snow
Washington Editor
WASHINGTON, DC, June 26 -- The world's total energy consumption could grow by 50% in the 25 years from 2005 to 2030, with most of the increase coming in developing countries, reported the US Energy Information Administration in its latest International Energy Outlook (IEO) June 25.
Demand could grow by 85% in countries outside the Organization for Economic Cooperation and Development and by 19% within the OECD, which comprises most of the world's industrialized nations, according to the 2008 IEO reference case. The report assumes that economic growth outside the OECD will average 5.2%/year compared with an average 2.3%/year growth within the OECD.
Petroleum and other energy liquids are expected to continue to supply the largest part of total consumption, but their share could decline to 33% in 2030 from 37% in 2005, largely in response to world oil prices remaining relatively high, the forecast indicated in its base reference case.
The price assumptions, which do not reflect carbon constraints, were set late in 2007 and could be revised to reflect significant increases since that time, EIA Administrator Guy F. Caruso said. "We think that over the next 5-10 years, high prices will bring on new supplies that will exert downward pressure. But we're not going back to 1980s prices in the $20 range," he said as he unveiled the forecast at the Center for Strategic and International Studies.
The strongest growth in energy liquids demand may be in emerging Asian economies and would average 15-31%/year, Caruso said. In North America, biofuels should represent about half of the liquids supply growth, but a significant amount could come from nontraditional fossil fuel sources, he indicated.
Economics could improve
"The economics of developing unconventional sources, including coal-to-liquids, could become attractive with continued higher prices," Caruso said. "The current constraints on oil sands in Alberta, particularly materials and labor, should ease off." Oil sands probably will propel Canada's production growth while production within the US could increase with more Gulf of Mexico deepwater activity and greater application of enhanced oil recovery onshore, he said. "A significant amount of new US liquids production will have to come from tar sands, oil shale, and other unconventional sources," he said.
The effect of additional production from the US Outer Continental Shelf on oil prices through 2030 would be small because it would take so long to bring online, he continued. "With higher prices, there could be a difference. But the length of development time indicates the impact would be minimal," he said. The OCS could increase total US crude oil production by 200,000 b/d by 2030 if federal leasing expands into areas that currently are off-limits, he said.
Caruso emphasized that EIA's long-term forecasts are designed to suggest trends instead of specific outcomes. Nevertheless, the new IEO predicts that the world's crude oil markets will remain relatively tight. "Given current market conditions, it appears that world oil prices are on a path that more closely resembles the projection in the high-price case than in the reference case," it said.
The outlook projected that worldwide natural gas consumption could grow to 158 tcf in 2030 from 104 tcf in 2005 as it replaces oil wherever possible in industrial and electricity uses. Non-OECD nations are expected to provide a major portion of new gas production, much of it as LNG exports. "The Middle East and Africa are at the forefront of the trend toward LNG; natural gas production in the two regions combined increased by 21 tcf [during] 2005-30 but their combined demand increased by only 9 tcf," the forecast said. Prices average about $8/Mcf in real terms under the high-price case.
"By far, the most important component in consumption is growth in emerging economics, particularly China and India, and the absence of carbon constraints, which would lead to growth in carbon dioxide emissions of about 2%/year. Right now, economics and technology constraints suggest there will be no meaningful carbon capture and storage contributions before 2030," Caruso said.
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