Fossil energy: a disappearing species?

Let us have a detailed look, on the one hand at the main consumers of fossil energy throughout the world, and how their consumption has changed over the last 10 years, and on the other hand at the zones of production throughout the world.

Oil

The principal consumer countries are, without any surprise, the developed countries of North America, Europe and Asia. The grand champion of oil consumption: the United States. With a little less than 5% of total world population, America consumes a quarter of all the oil produced each year and that rate of consumption is not slowing down: +16% in the decade from 1993 to 2003, about the same as the average for the world as a whole.

Until today, increases in oil consumption have always been balanced by equivalent increases in production, even if at times tensions have resulted in hikes in the price of crude oil, such as in 2004/2005.

The countries that have made the biggest efforts over the last 6 years are not those belonging to OPEC. Globally, OPEC production has even gone down slightly. There are two main reasons for that:

- In 1982, in a violent post-oil-crisis rebound, oil prices dropped significantly. That was the year when OPEC decided to install its policy of quotas, that is to say, to give each of its members a total volume of crude production that should not be exceeded: the aim being to control production and hence prices, and to conserve reserves for future generations. This policy has worked well on the whole. It has allowed OPEC to dig less deeply into its reserves than non-OPEC countries, whilst at the same time maintaining relative price stability.

- Certain OPEC countries, in particular those of the Arabian Peninsula and Iraq, possess very large reserves, but their production capacities have changed very little for at least 20 years. Increasing capacity would mean very heavy investment, which, for the moment, has not been forthcoming. The result is that, for many of them, their maximum production year is situated towards the end of the 1990’s.

On the other hand, exploration and development of new oil fields has made significant progress in several non-OPEC regions (around the Caspian Sea, in the Atlantic Deeps, in Brazil and in Angola, …).

Natural gas

As in the case of oil, the major consumer countries for gas are the developed countries and often also developing countries having significant production of their own together with a large population (Iran, Egypt, Uzbekistan …).
Consumption of gas is increasing steadily every year, more rapidly even than oil. It progressed some 24% during the 10 years between 1993 and 2003.
As is the case for oil, the Middle East has major gas reserves (41% of world reserves). But its production remains limited (10% of world production). In fact, the major consuming countries of North America and Europe draw on their own reserves, partly because the distribution of gas is proportionally more expensive than that of oil. It is therefore less attractive to bring gas from far away.

Coal

For most of these countries, the figures for consumption and production are relatively close to each other (except for Australia, a major exporter). The same remark can be made at the level of continents or large geographical regions. Some countries are marginal coal exporters, others marginal importers. Compared to oil, gas and uranium, coal is therefore much less important in terms of international commerce. Of course, it is nevertheless transported within producing countries, from the production areas to the electricity power stations and to the industrial boilers where it is used.