Global energy demand outstripped expectations in 1996, and oil prices were surprisingly high.
However, world markets have already corrected for this growth spurt and returned to longer-term growth trends.
So says British Petroleum Co. plc, which published its latest statistical review of world energy last week.
Exceptional year
Last year was an exceptional year for energy markets, said BP.
Energy demand outside the former Soviet Union increased by 3.7% last year, while worldwide energy demand grew 3%, more than double the average growth seen in the last 10 years.
Peter Davies, BP's chief economist, said worldwide primary energy consumption rose to 8.38 billion metric tons of oil equivalent (toe) in 1996 from 8.18 billion toe in 1995.
Worldwide oil consumption rose 2.4% in 1996 to an average 69.55 million b/d. The increase was attributed to strong demand in North America and Europe, which suffered winters colder and longer than average.
Oil production rose by 2.9% worldwide last year to an average 69.69 million b/d. More than half the increase was met by producers outside the Organization of Petroleum Exporting Countries.
Non-OPEC growth
"The growth of non-OPEC production," said Davies, "continues to confound those forecasters who believe that non-OPEC production will eventually plateau and decline within a 5-10 year time horizon owing to limited reserves.
"The plateau continues to recede, and if anything the trend in the growth of non-OPEC production is accelerating at 700,000 b/d per annum. The growth in 1996 production was above trend at 1.2 million b/d."
BP reported that estimated worldwide oil reserves stood at 1.037 trillion bbl at yearend 1996, up from 1.017 trillion bbl at yearend 1995.
OPEC countries accounted for 76.1% of the 1996 reserves total.
Oil prices
Davies said oil prices were comparatively strong last year.
Brent crude oil reached $24/bbl at one point, while the average price for 1995 was $20.81/bbl.
"It now seems that 1996 was an exceptional year rather than the start of a new oil price era," said Davies. "Oil consumption was boosted by cold weather in the Northern Hemisphere, and global gross domestic product growth was above trend.
"The market entered 1996 with low stock levels. Slightly stronger demand and weaker than anticipated supply growth translated into a buoyant market for prompt crude.
"However, the underlying tendency of supply to drive the market gradually took charge. Prices have reverted to the last 10 years' trading range of $15-20/bbl."
Gas status
Global gas demand growth also grew strongly, said BP.
Worldwide demand grew 4.7% to a total 2.19 trillion cu m in 1996, helped by the cold winter and increasing gas-fired power generation in some countries.
Worldwide estimated natural gas reserves amounted to 141.33 trillion cu m at yearend 1996, up from 139.71 trillion cu m at yearend 1995.
Worldwide gas production rose 4.9% last year to 2.231 trillion cu m.
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