Since the early nineties, OPEC has engaged actively in specialized research and workshops, focusing on future energy studies. OPEC's annual report on the future of the oil industry over the next two decades, published under the title of “World Oil Outlook 2010”, summarizes the results of the studies conducted and data gathered by OPEC regarding the future of the energy industry until 2030. In the foreword of the annual report, OPEC's Secretary-General Mr. Abdallah al-Badri summarizes the principle conclusions of the report as follows: “The numbers point to the fact that there are clearly enough resources to meet future demand.” It is clear, however, that “many challenges remain. These include the extent and nature of the global economic recovery, downward pressures on demand, uncertainties regarding market signals that are paramount for market stability, and major energy and environment policy developments.” The report indicates that demand for energy in general, including petroleum, is on the rise for various reasons, such as economic growth in emerging countries (China, India and Brazil), and also the fact that OPEC countries are readily able to meet the growing demand for oil. The report also points out to many obstacles that might face this upward trend of oil demand, such as legislations passed into law, on the grounds of national security or environmental concerns. However, their primary aim is either to limit oil consumption or to reduce dependence on oil imports. This is not to mention the radical changes taking place in the petroleum industry, such as commercial production of shale gas and the impact this has on natural gas markets. The report then provides data on many trends and indicators, which we will summarize in part here. For instance, the report mentions that global demand for commercial energy has increased progressively, from 55 million barrels of oil equivalent per day (mboe/d) in 1960 to 227 mboe/d in 2008, in tandem with the expansion of economies worldwide, the growth of the global population and the improved living conditions across the world, particularly in developing nations. Available data suggest that by 2030, world energy demand will increase by nearly 40%. In fact, developing countries will account for most of this increase in the demand for energy, due to the fact that these have the largest populations and highest population growth rates. Demand for oil in these countries is also likely to increase on account of the continuously improving standard of living there, leading to new and increasing demand for energy. However, the report mentions at the same time that energy poverty will continue to exist in developing countries, despite these radical changes, while Western industrialized countries will continue to provide high levels of energy for a majority of their populations. All indications show that long-term economic growth will be positive. This means that the growth levels of energy demand will also be high. Factors contributing to these positive trends include a possible growth of the world populations to 8.3 billion in 2030, in an increase of 1.5 billion from 2009. Of this increase, 95% will take place in developing countries. Also, long-term economic growth will vary worldwide from region to region. Here, we find that South Asia and China will witness the largest growth rates up until 2030. The World Oil Outlook 2010 also addresses the future implications of certain industrial trends on the energy industry, such as those of shale gas. In this regard, the report mentions: “Talk of shale gas transforming the US energy market has been gathering momentum in recent years. The figures being discussed are potentially huge. The surge in the development of US shale gas has occurred in response to a rapid increase in natural gas prices leading to many avenues being explored to alleviate tight supply. Supplies of shale gas have been known about for decades, but have until now proven difficult to exploit. However, the melding of horizontal drilling and hydraulic fracturing has lowered costs considerably. The effect has already been felt with lower natural gas prices and in the rapidly changing economics of liquefied natural gas (LNG). Interest in shale gas in Europe, as well as in China, is also beginning to gather pace. Whether shale gas is a ‘game changer' remains unclear. However, its potential is undisputed.” The report also mentions the implications of deep water drilling in the seas and oceans, and the impact of oil spills on the petroleum industry, especially in terms of offshore drilling in deep waters, such as in the Gulf of Mexico, one of the primary sources of new oil for the United States. Naturally, the report then cites the explosion in the Macondo field last spring. According to the report, “in making the supply outlook assessment, attention has also been paid to the possible consequences of the Deepwater Horizon drilling rig explosion. There are a number of possible short-, medium- and long-term implications for the offshore oil industry, particularly in the Gulf of Mexico. Of course, the moratorium on offshore exploration and drilling [following the Macondo incident] had already impacted ongoing projects. More stringent regulations are likely, and this could lead to increased costs and potentially less exploration”. This means that drilling costs in deep waters will be likely to increase in the future. *. Mr. Khadduri is an energy expert
