U.S. natural gas production led worldwide last year, rising 4.3% from 2006 to 545.9 billion cubic meters, according to BP plc’s review of world energy markets. Total global gas output in 2007 reached 2,940 billion cubic meters, which was 2.4% higher output than in 2006.
The London-based major issued its annual BP Statistical Review of World Energy last week, which was the producer’s 57th compilation of world energy trends.
“The defining feature of global energy markets remains high and volatile prices, reflecting a tight balance of supply and demand,” said BP CEO Tony Hayward. “This has put issues such as energy security, energy trade and alternative energies at the forefront of the political agenda worldwide.”
Worldwide natural gas consumption grew by an above-average 3.1% in 2007 — but only North America, Asia-Pacific, and Africa recorded above-average regional growth. The United States accounted for nearly half of the world’s gas consumption growth, driven by cold winter weather and strong demand for gas in power generation, researchers found. Chinese gas consumption grew by 19.9% and accounted for the second-largest increment to global gas consumption. In the European Union (EU) consumption declined by 1.6% — the second consecutive decline — following warm winter weather.
U.S. gas production accounted for the largest increment to supply in 2007, which was its “strongest growth since 1984,” the report noted. EU production declined by 6.4%, with UK output falling by 9.5%, the world’s largest volumetric decline for a second consecutive year. A small decline in Russian production was “more than offset” by strong growth elsewhere in the Former Soviet Union. China and Qatar recorded the second- and third-largest increments to gas output, up 18.4% and 17.9% respectively.
Global oil production in 2007 fell for the first time in five years, and reserves also declined, the review found. Meanwhile, 2007 global oil consumption rose 1.1% to 85.22 million b/d; U.S. consumption fell 0.1% to 20.698 million b/d.
World economic growth, Hayward noted, “was strong last year, despite financial market turmoil that began in August, and this continued to support global energy consumption. Although growth in consumption slowed in 2007 compared with 2006, it was still above the 10-year average for the fifth consecutive year.”
Oil prices have been on an “upward path for more than six years now,” he noted. “According to our data series, which goes back to 1861, that is the longest period of rising prices on record — and we know how this has continued so far this year.”
Coal, considered affordable and produced in many parts of the world, was the fastest growing fossil fuel for the fifth year in a row, according to BP. Globally, oil consumption rose, but at the weakest rate of all the fossil fuels, reflecting the pressure from high prices. “Interestingly,” said Hayward, “oil consumption growth is now concentrated in countries that subsidize consumer prices, primarily oil-exporting nations and rapidly growing…economies such as China and India.”
Ongoing growth in fossil fuel consumption “suggests that global carbon dioxide emissions are still rising,” Hayward said. “However, 2007 was another year of rapid growth for alternative sources of energy, including biofuels, solar and wind power.”
Despite high and volatile energy prices, “the data shows how the world’s energy markets continue to deliver reliable energy supplies,” he said. “This review highlights the interconnected nature of those markets, and how they require producers and consumers to collaborate in solving our mutual challenges. As policymakers around the world seek to address concerns about energy security and climate change, this points to the importance of supporting a proper role of market mechanisms in energy.”
The statistical review is available for download at www.bp.com.
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