Developing world leapfrogs OECD in energy consumption - BP

10 June 2009 13:11  [Source: ICIS news]

LONDON (ICIS news)--Emerging economies have leapfrogged the developed world in the consumption of primary energy, which could increase market volatility in the short term, UK-based oil giant BP said on Wednesday.

"The centre of gravity of the global energy markets has tilted sharply and irreversibly towards the emerging nations of the world, especially China,” said BP CEO Tony Hayward.

Hayward said the shift away from economies in the Organisation for Economic Co-operation and Development (OECD) was set to continue, affecting price and bringing with it new challenges over economic growth, energy security and climate change.

“This shift will bring volatility in the short term,” Hayward warned. “But I have no doubt that the diversity and flexibility of modern energy markets will continue to ensure that energy supplies continue to reach consumers efficiently and without interruption.”

In its 2009 statistical review, BP estimated that remaining proved oil reserves – excluding Canadian oil sands – of 1,258bn bbl would last for 40 years at 2008 production rates.

On the same basis, reserves of gas were seen as sufficient for 60 years and coal for 122 years.

The review showed the global primary energy consumption nudged up 1.4% in 2008, the smallest rise since 2001, as it was hit by economic crisis.

China accounted for almost three quarters of the rise, with most of the balance coming from the remaining Asia Pacific region.

Energy consumption in the developing world was seen to have dropped 1.3%, with US demand falling 2.8% in its sharpest decline since 1982.

BP said global oil consumption dropped 0.6%, or 420,000 bbl/day, in 2008 – the first fall since 1993 and largest drop for 27 years.

World oil production was seen to have risen 0.4%, 380,000 bbl/day, driven largely by OPEC production increases.

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By: Mark Watts
+44 20 8652 3214

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