Oil States' Econ Health At Risk Due Demand, Supply-Report
DOW JONES NEWSWIRES
July 24, 2008 10:18 a.m.
LONDON (Dow Jones)--The longer-term financial health of oil exporting nations may deteriorate despite booming in recent years, because many of them are becoming big petrol consumers which over time will squeeze their vital oil export revenues, London think-tank Chatham House warned Thursday.
Exporters' potential financial problems also hinge on an expectation oil production will flatten as aging fields grow less productive and new discoveries become less frequent. Demand globally is seen easing as consumers search out non-oil alternatives and conserve more, the group said in a new report.
According to the outlook, the net result would mean less oil revenue for producing states. This raises big questions over their longer term economic growth as they are highly dependent on the oil sector.
"What we are talking about is the issue of compensating for lost oil revenues because of falling oil demand worldwide, rising (oil) demand internally, and the prospect of plateauing production," said John Mitchell, lead author of the report.
"We are not talking about tomorrow, this is a long-term problem," even for Saudi Arabia, the world's biggest oil exporter, he said. The country could cease to be a net exporter in three decades if its own oil consumption continues growing and it is unable to add significantly to its oil reserves, the biggest in the world.
WSJ
Chatham House forecasts peak production of gas in Azerbaijan in for 2011-16 and oil for 2010-13
Baku, Fineko/abc.az. In its report Resource Depletion, Dependence and Development UK’s Chatham House estimated producing potential in hydrocarbons sector of Azerbaijan. The report project was funded by the Asian Development Bank, the Norwegian Ministry of Petroleum and Energy and BP.
Chatham House report says that peak production of gas in the country is expected 2011/2016 and oil in 2010-13.
“In this period Azerbaijan will produce 500,000 mboe/d and 1.3 million of oil,” it was informed.
At the same time country’ hydrocarbon reserves were estimated in 824 barrels of oil per capita and 999 barrels of gas in oil equivalent. In oil production Azerbaijan yields to Kuwait (39 038 barrels), Saudi Arabia (11 150 barrels), Kazakhstan (2 603 barrels), Iran (1 961 barrels) and Norway (1 808 barrels) and in gas extraction to Kuwait (4 306 barrels), Norway (3 868 barrels), Iran (2 524 barrels), Saudi Arabia (1 876 barrels) and Kazakhstan (1 233 barrels).
ABC.AZ
UK’s Chatham House surveyed 12 hydrocarbon-exporting countries and concluded on growth of their dependence on oil revenues
Baku, Fineko/abc.az. UK’s Chatham House has completed its project - Resource Depletion, Dependence and Development. The project was funded by the Asian Development Bank, the Norwegian Ministry of Petroleum and Energy and BP.
The report oriented for period until 2030 looks at Algeria, Angola, Azerbaijan, Indonesia, Iran, Kazakhstan, Kuwait, Malaysia, Nigeria, Norway, Saudi Arabia and Timor Leste.
Petroleum-fuelled prosperity is masking the challenge of oil depletion and removing the sense of urgency that is desperately needed to promote diversification in oil-exporting states. All eyes are on supply-demand dynamics instead of how these countries" economies - so linked to our own - can be sustained as oil and gas resources deplete.
A new report by Chatham House says today"s oil-price boom may be raising the global profile and financial clout of oil-exporting countries but their dependence on oil, (and gas) revenues has increased. This cannot continue: production will level off and eventually fall; rising energy consumption at home will reduce the amount available for export. For these countries to continue to grow, dependence on oil revenues must be reduced.
The report discusses, with some pessimism, the capacity of most of these countries to reduce their dependence by developing new sources of government revenue and export earnings from the non-hydrocarbon sectors of their economies.
The study estimates, under simple assumptions and various scenarios, how long each of the twelve exporting countries looked at here, would have until it must begin reducing dependence, how big the reduction should be by 2025, and when exports are likely to tail off.
Strikingly, it shows that even Saudi Arabia must plan for export decline, and explains why some countries might rationally choose to keep oil in the ground, even at over $100 a barrel.
The prospects for many are not that good. Only three of the twelve countries are clearly on a path of ending their dependence on oil: for most of the others, time is running out for finding sufficient alternatives to sustain current or even moderate rates of growth in the long term.
ABC.AZ
