Oil demand set to increase in 2005

DUBAI - Oil demand is expected to increase by 1.5 million barrels per day in the year 2005, according to a senior official from Organisation of the Petroleum Exporting Countries (Opec).

By Jamila Qadir

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Published: Wed 15 Dec 2004, 9:47 AM

Last updated: Thu 2 Apr 2015, 11:47 AM

Dr Adnan Shihab-Eldin, director, research division Opec, told this correspondent yesterday that much of this 1.2 million bpd would come from non-Opec oil producers, while the rest will be provided by Opec.

He said Opec would continue to be the main player in the market. “Some 80 per cent of world oil is produced by Opec. It is still cheaper to produce oil in the Middle East than to get it from some remote areas.”

Speaking about oil prices after a panel discussion during the on-going Arab Strategy Forum, he said: “We look to stabilise oil prices (next year). We will finish this year at the range of $35 to $36 per barrel.”

During the panel discussion, the oil ministers of UAE and Qatar have ruled out the possibility of oil declining in importance by the year 2020. “Oil will continue to play a very strong role. There will be more need for oil,” said Abdulla bin Hamad Al Atiyah, Second Deputy Prime Minister and Minister of Energy and Industry of Qatar.

UAE Minister of Energy, Mohammed Al Hamli said: “The future is very much for oil. Oil will be dominant in 2020.” Speaking during the third session on ‘Energy in 2020 - the Future of Oil and Gas,’ Al Hamli pointed out that demand for oil is forecast to grow by 1.7 per cent from now until the year 2020.

Supporting the Arab oil ministers’ comments, Lord Howell of Guildford, former UK Energy Secretary, said: “Demand for oil will go roaring onwards. There may be hiccups, but it will go on.”

He said that the scenarios presented by analysts were much too gloomy. “I believe the possibilities are increasing and are very positive. China has been drinking oil. It has just started. The same applies to India. We haven’t even started on the growth in demand in these areas. The USA continues to drink oil at enormous rates,” he pointed out.

He saw a bright future for oil for several reasons. The former UK Energy Secretary said that the risk and costs were very high for non-Arab or non-Opec sources of oil.

The alternative sources of energy scene, too, is not working.

“Instead of carbon emission falling, they are actually going up and alternatives to fossil fuels are not doing too well,” he argued.

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