Increased Asian oil drilling fails to slow demand

Asia’s expanded oil drilling, spurred by record prices, has failed to increase supplies and ease the region’s growing reliance on the Middle East, Fereidun Fesharaki, chief executive officer at the oil consultancy Facts, said Monday at the Asia Oil & Gas Conference.

Asia’s annual oil demand may grow as much as 800,000 barrels a day, more than double Sweden’s consumption, he said.

Asia is becoming more dependent on Africa, Russia and the Middle East for energy as investments fail to keep up with rising demand for gas, diesel and gasoline. Royal Dutch Shell, Petroliam Nasional and China Petroleum & Chemical are increasing shipments to Asia from fields as far away as Sudan and Angola.
“Costs to find, develop and produce oil and gas has increased by an average of 50 percent over the last two years,” said Hassan Marican, chief executive of Petroliam Nasional, Malaysia’s state- run oil company. “The increase in capital expenditure and shortage in capacity in contracting services may result in the deferment and delays of some projects.”

International Herald Tribune