Domestic demand to diminish Saudi ability to export oil
Wednesday, 28 April 2010
From Fazle Rashid
NEW YORK, April 27: Saudi Arabia, world's largest oil producer and exporter, issued a warning yesterday saying growing domestic demand will significantly diminish its ability to export oil to the rest of the world in the next two decades. Saudi experts have projected the domestic demand to increase by 250 percent to 8.3 million barrel a day by 2028 from 3.4 million barrel a day now.
The oil availability for exports is likely to decline to less than 7.0 million barrel per day while global demand for oil will continue to rise, a reputed paper quoted a senior Saudi official as saying. The oil demand is growing beyond projection with China becoming the second largest consumer of oil after the United States.
Saudi Arabia produces 8.5 million barrel a day but has raised its production capacity to 12.5 million barrel a day last year. But rapidly rising energy demand and natural gas shortages have meant the kingdom has had to burn increasing amounts of crude oil as its seeks to diversify its economy, an analyst said.
Saudi Arabia has the fourth largest proven gas reserve in the world. Though price of oil keeps on rising there has been no or very little new investment in this sector. The gas consumption in the kingdom is growing by 7.0 per cent a year.
Saudi Arabia will perhaps have to aid its trusted ally Pakistan which is also enduring a crushing power crisis. Pakistan is in the throes of an energy crisis with country experiencing a daily 12 hour power outage, the New York Times in a six column story revealed today. It is a concern for the United States, which is trying to help steady Pakistan's wobbly finance and keep its democratically elected government afloat. The Obama administration has pledged about $1.0 billion for Pakistan's energy sector over the next five years, the NYT said.
NEW YORK, April 27: Saudi Arabia, world's largest oil producer and exporter, issued a warning yesterday saying growing domestic demand will significantly diminish its ability to export oil to the rest of the world in the next two decades. Saudi experts have projected the domestic demand to increase by 250 percent to 8.3 million barrel a day by 2028 from 3.4 million barrel a day now.
The oil availability for exports is likely to decline to less than 7.0 million barrel per day while global demand for oil will continue to rise, a reputed paper quoted a senior Saudi official as saying. The oil demand is growing beyond projection with China becoming the second largest consumer of oil after the United States.
Saudi Arabia produces 8.5 million barrel a day but has raised its production capacity to 12.5 million barrel a day last year. But rapidly rising energy demand and natural gas shortages have meant the kingdom has had to burn increasing amounts of crude oil as its seeks to diversify its economy, an analyst said.
Saudi Arabia has the fourth largest proven gas reserve in the world. Though price of oil keeps on rising there has been no or very little new investment in this sector. The gas consumption in the kingdom is growing by 7.0 per cent a year.
Saudi Arabia will perhaps have to aid its trusted ally Pakistan which is also enduring a crushing power crisis. Pakistan is in the throes of an energy crisis with country experiencing a daily 12 hour power outage, the New York Times in a six column story revealed today. It is a concern for the United States, which is trying to help steady Pakistan's wobbly finance and keep its democratically elected government afloat. The Obama administration has pledged about $1.0 billion for Pakistan's energy sector over the next five years, the NYT said.