Oil Demand Growth May Slow in 2015

U.S. energy officials on Monday predicted worldwide demand for oil and refined products will grow at a slower rate starting in 2015 and that over the next quarter century oil prices will climb as high as $95 a barrel.

By 2030, the share of worldwide energy that comes from oil and refined products will decline to 34 percent, down from 38 percent in 2004, the Energy Department said in its annual international outlook.

The agency forecasts crude oil prices, in 2005 dollars, will drop to $49 per barrel in 2014, but then start climbing again to $59 a barrel by 2030 – or $95 per barrel without adjusting for inflation.

“We know it’s not going to be a nice steady straight line,” Guy Caruso, administrator of the agency’s forecasting arm, said at a briefing in Washington.

Also on Monday, U.S. retail gasoline prices climbed to a new record of $3.20 per gallon, according to AAA and the Oil Price Information Service.

The Energy Department report, which assumes no changes will be made to energy policies and regulations, estimated global energy demand – for oil, natural gas, coal, nuclear and renewables – will rise by 57 percent over the next 25 years.

Over that same period, coal’s share of world energy demand will rise to 28 percent, up from 26 percent in 2004 – rising faster than any other energy source, at 2.2 percent annually, the federal agency said.

By 2030, natural gas will make up 24 percent of worldwide consumption, up from 23 percent; nuclear power will remain steady at 6 percent of worldwide energy demand; renewable forms of energy like hydroelectric dams, geothermal energy, wind, solar and biomass, will rise to 8 percent of total world energy demand, up from 7 percent.

The agency raised its outlook for nuclear power from last year, due to higher fossil fuel prices and improved designs for nuclear reactors.

Worldwide demand for oil and other liquid fuels – including ethanol and biodiesel – will rise to 118 million barrels a day by 2030, up from about 85 million barrels a day now, with nearly half of the growth coming from the United States, China and India, according to the forecast.

Forbes