Global energy demand is expected to grow 50% over the next 25 years, driven by strong economic growth in India and China, a top ExxonMobil executive said on Thursday.
“We expect sustained economic growth, just under three percent a year… rising personal income and standards of living especially in Asia,” said Kwa Chong Seng, ExxonMobil Asia Pacific’s chairperson and managing director.
“China and India are very much part of the equation,” Kwa told an energy forum organised by the Institute of Southeast Asian Studies (Iseas).
“With this kind of three percent economic growth… this would drive energy demand from 220-million barrels of oil equivalent [per day] to 335 [million barrels over the next 25 years].”
Oil prices soared to historic highs above $70 dollars a barrel in August after Hurricane Katrina hit United States oil and gas facilities in the southern states.
The spike in prices, however, reflected nervousness over the wider supply and demand equation, with robust growth in India and China driving a sharp increase in oil consumption.
With energy needs unlikely to ease, the need for major oil discovery has taken on greater urgency as existing fields mature, said Peter Cockroft, a visiting research Iseas fellow who also spoke at the forum.
“We are consuming at least six times more oil than we are finding and that to me is a big problem,” Cockcroft said.
“Where are we going to find our new oil? It’s not obvious… really we don’t know,” he said.
Unless new oil discoveries are made, the world will continue to rely on the Middle East, home to the largest proven oil reserves of almost 734-billion barrels, for the bulk of its oil needs.
This is not exactly an ideal situation given the political tensions in the oil-rich region.
“The supply is not where we want it… Unfortunately, the supply of crude oil is in areas where there is a perception of instability,” said Cockcroft, who has worked for 25 years in Asia for various energy firms including BHP Petroleum.
To boost hopes of finding new oil fields, the world will have to start looking at places which has been avoided previously, such as the Arctic region and in deep waters, Cockcroft said.
“We’re going to find it in what I call ‘extreme’ conditions, places that we have avoided in the past.” – AFP