StatoilHydro says oil prices eating into demand

OSLO (Reuters) – The global economy has been more resilient than expected during the oil price surge of the past five years but current high prices have started to hit demand, the boss of Norway’s StatoilHydro told Reuters.

Chief Executive Helge Lund said on Wednesday that production of conventional oil from non-OPEC countries would probably peak before 2020 but added that the outlook was brighter when natural gas and unconventional oil resources were included.

“So far the global economy has been more resilient than we anticipated to the price rises that we have seen since 2003 or 2004,” Lund said in an interview.

“At these prices we see now, I guess we will also see some impact on the demand side,” he said. “Some demand destruction has already taken place and there are tremendous incentives out there to generate new energy sources and alternatives to hydrocarbons.”

Lund said the oil industry was working “at or very near” capacity but played down the concept of peak oil, or the idea that global production is near an apex after which it will sharply decline.

Reuters