In its annual World Oil Outlook, the organization says fossil fuels will remain a primary energy source in coming decades, with coal leading the pack.
OPEC’s findings extend through 2035.
Specifically, while demand for energy will rise 54% by 2035, fossil fuel’s share of the world’s utilization will decrease only slightly from 87% currently to 82% in 2035.
“For most of the projection period, oil will remain the energy type with the largest share,” OPEC says.
“However, towards the end of the projection period, coal use … reaches similar levels as that of oil, with oil’s share having fallen from 35 per cent in 2010 to 27 per cent by 2035.
“Natural gas use will rise at faster rates than either coal or oil, both in percentage terms and quantities, with its share rising from 23 per cent to 26 per cent.”
So, while many are concerned about coal’s competition with other fuels in the short term, oil may actually be the biggest loser of the sector in the long term.
For perspective, the group says long-term crude demand will rise to 107.3 million barrels per day, from 87Mbpd in 2010.
Most of the increase will come from countries in Asia.
In fact by 2035 Asian demand will account for 90% of demand from developed nations of the OECD.
OPEC also says the world is not short on coal supply.
However, as many countries already know well, carbon constraints will be the biggest obstacle.
“In terms of calorific value, there are more coal reserves than the sum of oil and gas reserves,” OPEC says.
“At the end of 2010 the highest level of reserves by far was in the US which, together with Russia, China, India and Australia, account for three-quarters of global reserves.”
Coal, according to the report’s authors, has been the fastest growing fossil fuel over the past decade.
How the world – including the US, which has been crippled by this issue of late – responds from an environmental and regulatory perspective will decide where that road will lead.
“In addition to the health of the economy, its future prospects hinge on the competition from other sources of electricity generation, primarily gas and nuclear, as well as the stringency of future carbon emissions reduction policies, the price of carbon permits and energy security,” OPEC says.
“The contribution of carbon capture and storage to climate change mitigation measures will play an important role in determining the sustainability of coal use in a more carbon-constrained world.”
The full 300-page report is available by visiting www.opec.org/opec_web/static_files_project/media/downloads/publications/WOO2012.pdf
