US Shale Gas Leads Global Energy Market in BP Outlook
“The rapid expansion of LNG [liquefied natural gas] is likely to lead to a globally integrated gas market, anchored by US gas prices,” the report concluded.
Oil, gas, and coal will remain the dominant sources of energy, according to the report, while renewables, together with nuclear and hydroelectric power, will provide half of the additional energy required through 2035. Renewables will become the fastest growing fuel source overall, quadrupling over the next 20 years.
In the scenario explored in the recently-released BP Energy Outlook for 2017, world GDP almost doubles through 2035, driven by fast-growing emerging economies, with more than two billion people lifted from low incomes.
Rising prosperity, not surprisingly, drives an increase in global energy demand. But the extent of the growth is offset by gains in energy efficiency. Energy demand increases by only around 30 percent, in the next 18 years, concludes the BP report.
The increasing penetration of electric cars will have an important bearing on future oil demand. While the report foresees continued growth in oil demand, the pace of demand will slow. The abundance of oil resources may prompt low-cost producers to use their competitive advantage to increase market share.
Unlike gas and oil, coal demand seems set to proceed on a downward demand slope. “Global coal consumption looks set to peak,” according to the report. China’s economic reforms will slow that country’s demand for coal—and energy generally—although China will remain the largest growth market for energy.
Carbon emissions from energy will grow at less than a third of the rate of the past 20 years, under the BP scenario, reflecting gains in energy efficiency and the changing fuel mix. “But emissions continue to rise,” the report concluded, “highlighting the need for further action.”