Middle Eastern countries and other emerging economies will drive future global energy demand and provide growth opportunities for the market’s oil and gas companies.
According to an Ernst and Young (EY) report, rising population and increasing demographic urbanisation in rapid growth markets (RGMs) will sustain the rising energy demand.
EY forecasts that most of the projected growth in energy generation and consumption in RGMs will come from fossil fuels, especially natural gas.
“This increase in demand, coupled with increased access and availability of natural gas resources, means natural gas is expected to play a fundamental role in energy demand by 2015 if governments and regulators can build the appropriate regulatory and legislative environments,” said Dr. Thorsten Ploss, EY’s Middle East and North Africa Oil & Gas leader.
“The opportunity for RGMs has never been greater in the oil and gas sector. The need to have a clear view of the risks and opportunities across the oil and gas sector is critical to future success.”
The report projects that natural gas demand is expected to increase steadily over the next few years and is expected to account for almost a quarter of the world’s energy demand by 2035.
“Natural gas is seen as a potentially cleaner replacement for coal and also as a ready replacement for nuclear power in countries which have phased out nuclear power due to public concerns,” said Ploss.
“Countries needing to increase power capacity quickly are particularly likely to turn to natural gas, as the construction time for natural gas generating plants is just two to three years.”
The EY report projected that the oil majors will find it increasingly difficult to access global oil reserves resulting in energy production gradually shifting towards gas.