Energy in 2009
Posted by Rich Sweeney on January 4, 2009
From The Economist:
Demand for oil in the rich world will fall in 2009 by around 1% because of elevated prices and slowing economic growth. Oil prices will average around $75 a barrel for Brent crude. The growth of oil demand in emerging markets will slow to 3.1%, with total global consumption edging up by only 0.7%. For suppliers, the picture will be far from bleak. OPEC’s capacity cushion will double to as much as 3.6m barrels a day and, outside OPEC, oil production will improve as Brazil, Azerbaijan and the US all boost capacity.
Coal’s share in global energy will continue to climb because of its relative cheapness and abundance, especially in the two largest coal-producing/consuming countries, the US and China. In the US, more coal-fired than gas-fired power plants will come on stream in the next two years. Globally, demand for coal will rise by 4.6% in 2009 to 6.8bn tonnes; this trend will gather speed as countries with large reserves aim to reduce their dependence on oil imports.
Demand for natural gas will accelerate, led by India, the rest of Asia and the Middle East. Natural-gas substitution in electric power generation and heating is gathering pace. Among alternative energy sources, solar panels suffered in 2008 because the price of pure silicon, the main component of most solar cells, hit record levels. But UK-based New Energy Finance expects the output of silicon for the solar industry to double in 2009, leading to a 40% price drop.