Business | Oil & Gas
US priority on oil imports key to energy demands in the future
Financial crisis causing severe impact on demand, says expert
- By Himendra Mohan Kumar, Staff Reporter, Gulf News
- Published: 00:00 November 18, 2009
- Image Credit: Gulf News
Abu Dhabi: The priorities of the US Administration with regard to oil imports are key to future oil demand at the global level, an energy expert said here on Tuesday at an industry conference, adding the current global financial crisis is having severe impact on demand, forcing readjustments in the system.
"While the United States is not driving oil demand as much as China, it remains the world's biggest consumer of oil," Dr Ra'ad Al Kadiri, Partner and Head of Global Risk told delegates at the Energy Security in the Gulf — Challenges and Prospects conference. The event is the 15th annual energy conference organised by the Emirates Centre for Strategic Studies and Research (ECSSR).
"They [US] will also consider plans to reduce dependence on Middle East oil imports," he added.
"Producer countries have reason to be concerned by the impact of the financial crisis. There will be major implications primarily affecting energy efficiency and consumption, and therefore demand from both the developed and developing world," said Al Kadiri.
Ivan Sandrea, Vice President of Strategy for International Exploration and Production at Norway's Statoil Hydro said the oil demand will continue to grow, but it will change.
"There will be a sea of change in demand, as it will grow slower while that of other energy sources will rise. There is great uncertainty in the oil market, which will have a tremendous impact on long term investment," said Sandrea.
Professor Paul J. Stevens, Senior Research Fellow for Energy at UK's Chatham House said the spare oil production capacity of Gulf Cooperation Council (GCC) countries provides an opportunity to cash in on high prices in the future.
"Demand for oil will increase in the near term. This implies that there is potential for many price spikes. It is better for the GCC to maintain current spare capacity, using it only during spikes," Stevens added.
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