KUALA LUMPUR, June 8 â€“ Prime Minister Datuk Seri Najib Razak says global oil prices are still expected to rise as the global economy recovers.
Although perhaps not at the dramatic pace recorded in 2007 and the first half of 2008, he said, demand for oil today appears likely to grow at a more modest rate over the next five years compared to projections from only nine to 12 months ago.
“The development of higher cost reserves to satisfy rising demand remains inevitable eventhough the relevant demand will emerge later and perhaps more gradual than previously assumed,” he said in his keynote address at the 14th Asia Oil and Gas Conference here today.
Najib said the medium term outlook has also weakened besides immediate downward pressure from the global business cycle.
“Global growth is not expected to recover any time soon to the rapid pace achieved in years past as the financial crisis will have lasting effects on credit and capital flows. These trends and their consequences on the energy industry should be familiar to most of us,” he said. Najib said global primary energy consumption is expected to grow by 1.6 per cent per annum, leading to a 45 per cent increase in energy consumption between now and 2030.
In line with the expected shift of economic power to the East, the focus of global demand will swing to developing countries especially China, he said.
Najib said the transportation and commercial sectors would have the highest increase while industrial and residential energy consumption rises at a slower pace.
Source : Bernama