OPEC’s crude oil demand to reach 111 million bpd by 2040

The Organisation of Petroleum Exporting Countries (OPEC) expects demand for crude oil to hit an average of 111 million barrels per day by 2040.

Director of the Research Division of OPEC, Dr. Omar Abdul-Hamid, who made this disclosure in an interview with Siemens in-house magazine said that the organization believe there are sufficient resources to satisfy growing demand for oil.

According to him, new capacities from unconventional sources are a case in point. “Demand growth mainly comes from emerging economies and developing countries, particularly in Asia, and from OPEC member states. Their demand more than compensates for shrinking use in highly developed countries. Developed countries are reducing their oil consumption due to increasing fuel efficiency. Demand for oil will be in transportation and petrochemicals”, he said.

He said that effects of fracking in producing unconventional oil in North America have been seen over a relatively short time.

He stated: “However, on a global scale, fracking makes up only a small proportion of total production. Our forecast in the 2014 OPEC World Oil Outlook sees 3.8 million barrels of tight crude per day coming from fracking. Similarly, unconventional natural gas liquids contribute an additional two million barrels per day.

“These rates, when compared to the 91 million barrels per day of total world oil demand represent a small proportion. This contribution to supplies is also expected to level out in the near future before declining. On an even longer term, and when considering other forms of unconventional supply, by 2020 we expect their total contributions to production to reach approximately 13 million barrels per day under the right conditions. However, America will both import and export oil at the same time and continue to use oil from the Middle East for the foreseeable future.”

He said that changes in oil prices are not new and cost effectiveness will continue to be an important feature. “Before the oil price tumbled in late 2014 and early 2015, it maintained high levels for number of years. This may have bred some degree of complacency. It is healthy to step back to practices that help to control cost of capital and operation. In view of this, oil companies and investors will assess opportunities to plan and finance facilities that supply energy in response to growing future demand. Innovation is important for accomplishing this in a cost-effective manner. Using data in a smart way can help to improve exploration for oil and to optimize recovery. It can help at every step in the production chain. Automation will become more important in the oil industry”.

He stated that innovation is a necessity for our industry to continue to be reliable, safe and capable of meeting expectations. “We value specifications, robustness and reliability from a safety perspective, because we have a responsibility to our people and the communities we operate in.

“Availability of equipment is crucial from an economic point of view, too. When a field does not produce because of a technical defect, oil companies lose a lot of money. But it is a wrong perception to say the oil and gas industry is not innovative”, he added.

Over the course of the last few decades we have managed to produce oil under ever more challenging conditions. You can simultaneously sustain cultures that appear to be contradictory on first glance: the oil and gas industry is both conservative and innovative”, he added.