Changing Scenarios of Global Oil Market

Abstract

This paper attempts a prognosis of the demand, consumption and energy intensity of oil future. Adopting 2009 as the baseline year and 2030 as the timeline, the study resorts to the use of forecasting technique to model future oil scenario. In estimating future oil consumption, correlation analysis is run for the set of data generated and power laws that show best-fit lines are derived. United Nation’s (UN) middle variant scenario for ascertaining 2030 population sizes for Five oil-rich countries, namely Saudi Arabia, Russia, Iran, Nigeria and Mexico while World Bank projections are used to ascertain 2030 Gross Domestic Products (GDP) for these five countries. The study predicts that oil consumption over the forecasting period is expected to increase across board, barring the adoption of renewable energy policies and increased technological advances. The increase in oil consumption is likely to be driven by increased population growth and the expected acceleration of the economies of the countries studied. An implication for these likely trends is that increase in oil consumption is expected to worsen greenhouse gas (GHG) emissions and lead to worsening outcomes for the environment.

Keywords: oil consumption, oil forecasts, energy policies, oil prices, Energy efficiency