International Energy Agency on Tuesday raised its mid and long-term oil price forecast and said oil prices will exceed $200 a barrel in 2035.
In its 2010 World Energy Outlook, the IEA said oil prices would rise even further if governments did not take significant steps.
The growing concentration of oil use in transport and a shift of demand towards subsidized markets were limiting the scope for higher prices to choke off demand through a switch to alternative fuels, said the IEA.
If subsidy policy does not change, with increasing price assumptions, these $312 billion in subsidies for 2009 will reach $600 billion in 2015. That's huge, IEA said.
Despite the price increase, the agency said it saw primary energy demand increasing at a slower pace if governments followed through with policies and measures that have been set.
In that scenario, world primary energy demand increases by 36% between 2008 and 2035, or 1.2% per year on average, slower than the 2% per year average growth over the previous 27-year period, said the agency.
All of the net growth is expected to come from non-OECD countries, almost half from China alone. Demand in the OECD actually falls, by over 6 million barrels per day.
Meanwhile, IEA chief Nobuo Tanaka said, We have taken governments at their word, in assuming that they will actually implement the policies and measures, albeit in a cautious manner, to ensure that the goals they have set are met .
In its 2010 World Energy Outlook, the IEA said oil prices would rise even further if governments did not take significant steps.
The growing concentration of oil use in transport and a shift of demand towards subsidized markets were limiting the scope for higher prices to choke off demand through a switch to alternative fuels, said the IEA.
If subsidy policy does not change, with increasing price assumptions, these $312 billion in subsidies for 2009 will reach $600 billion in 2015. That's huge, IEA said.
Despite the price increase, the agency said it saw primary energy demand increasing at a slower pace if governments followed through with policies and measures that have been set.
In that scenario, world primary energy demand increases by 36% between 2008 and 2035, or 1.2% per year on average, slower than the 2% per year average growth over the previous 27-year period, said the agency.
All of the net growth is expected to come from non-OECD countries, almost half from China alone. Demand in the OECD actually falls, by over 6 million barrels per day.
Meanwhile, IEA chief Nobuo Tanaka said, We have taken governments at their word, in assuming that they will actually implement the policies and measures, albeit in a cautious manner, to ensure that the goals they have set are met .
