LONDON: BP expects global energy output to rise 37 percent by 2035 with China and India accounting for half of the total demand and Russia, Saudi Arabia and the U.S. providing a third of the supply.
With liquid fuel consumption rising to 111 million barrels per day driven by non-OECD transport and industry, BP CEO Bob Dudley (left) says the resultant growth in emissions by 25 percent in the next 20 years is unsustainable.
According to the International Energy Agency (IEA), a rise in global temperatures must be no more than 2°C to avoid catastrophic climate change. BP says the expected growth in energy consumption will exceed the IEA ceiling by 18 billion tonnes of C02 by 2035.
"The projections highlight the scale of the challenge facing policy makers at this year's UN-led discussions in Paris. No single change or policy is likely to be sufficient on its own. And identifying in advance which changes are likely to be most effective is fraught with difficulty. This underpins the importance of policy-makers taking steps that lead to a global price for carbon, which provides the right incentives for everyone to play their part," explained Dudley.
BP expects demand for oil will increase by around 0.8 percent each year to 2035 with China the largest single consumer. Energy self-sufficiency in North America - which is expected to become a net exporter this year – will lead to the U.S. being oil self-sufficient by 2030 after having imported 60 percent of its total demand as recently as 2005.
The current weakness in the oil market, which stems in part from strong growth in 'tight' (shale) oil production in the U.S. is likely to take several years to "work through" says BP. In 2014, shale oil production drove U.S. oil output higher by 1.5 million barrels a day – the largest single-year rise in its history.
BP expects natural gas production to increase 1.9 percent per annum by 2035 led by demand from Asia. Russia and the Middle East will supply 50 percent by conventional gas production and the remainder will come from shale gas. By 2035 North America, which currently accounts for almost all supply, will still produce 75 percent of the total.
As a result, BP expects LNG surface transport will have overtaken pipelines as the dominant form of traded gas with Asia Pacific overtaking Europe after 2020 as the largest net gas-importing region.