World energy market has 'tectonic shifts' says BP Statistical Review

Offshore staff

LONDON – The year 2014 was one of “tectonic shifts” in world energy production and consumption says BP in its annual Statistical Review of World Energy.

The 64th edition of the review highlights the continuing impact of US shale development as the US overtakes Saudi Arabia as the world's biggest oil producer and passes Russia as the world's biggest producer of oil and gas.

Consumption, however, rose at 0.9%, its lowest rate since 1990s, omitting the immediate aftermath of the financial crisis. This is in relation to the 10-year average growth rate of 2.1%. While China remained the world's largest growth market, its demand rose at the lowest rate since 1998.

The shifts in production and consumption had major effects on energy prices as well as on the fuel mix. BP's statistics show oil prices have fallen sharply, largely driven by the strength of supply as non-OPEC production grew by a record amount while OPEC maintained its output levels to maintain market share. The growth of China’s coal consumption stalled and global natural gas growth was also weak, held back by a mild European winter triggering a sharp fall in consumption.

Renewables were the fastest growing form of energy in the report, accounting for one third of the increase in overall primary energy use during a year in which global primary energy consumption growth slowed. Even so, they accounted for only 3% of primary energy.

Oil remained the world’s leading fuel, with 32.6% of global energy consumption, but lost market share for the fifteenth consecutive year. Global oil consumption grew by 0.8 MMb/d, or 0.8% – a little below its recent historical average and significantly weaker than the increase of 1.4 MMb/d in 2013. Global oil production growth was more than double that of global consumption, rising by 2.1 MMb/d or 2.3%.

BP reports that global natural gas production grew by 1.6%, below its 10-year average of 2.5%. Growth was below average in all regions except North America. The US (+6.1%) recorded the world’s largest increase, accounting for 77% of net global growth.

6/11/15

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