*Osama Suleiman from Vienna
The International Energy Agency (IEA) has confirmed that fossil fuels account for more than 70 percent of global energy demand growth. It noted that the demand for natural gas is higher than other energy resources, with a record 22 percent of global demand.
A recent report by the agency said that the global energy demand rose by 2.1 percent in 2017, according to preliminary estimates. It added that this growth represents more than twice the rate of growth in 2016.
The report noted that growth in the dependence on renewable energy sources was happened strongly, as these resources constitute about a quarter of the growth of global demand for energy. However, It pointed out that the total share of fossil fuels in global energy demand in 2017 would remain at 81 percent, a level that has been stable for more than three decades despite the strong growth in renewable energy sources.
The report highlights the growth of global energy demand in Asia, with China and India accounting for more than 40 percent of the increase. It pointed to the contribution of energy demand in all advanced economies to more than 20 percent of world demand growth, although its share of total energy use continued to decline.
Energy demand also grew significantly in South-East Asia (which accounts for 8 percent of global energy demand growth) and Africa (6 percent), although per capita energy consumption in these regions is still much lower than the World average.
The report noted a growth of global energy-related CO2 emissions of 1.4 percent in 2017. It pointed to a resumption of growth after three years of relatively stable global emissions.
The report considered that the increase in carbon dioxide emissions were not global, but varied from one country to another and from one region to another. It pointed out that most of the global economies have witnessed an increase in the level of emissions. While in contrast, some other countries experienced a decline in emissions including the United States, the United Kingdom, Mexico and Japan.
It noted that the largest decline came from the United States, mainly due to the increasing spread of renewable energy sources.
The report said that global demand for crude oil would rise by 1.6 percent (1.5 million bpd) in 2017. It is considering that this rate represents more than twice the annual rate witnessed by the industry during the past decade.
It added that this growth has boosted the rise in the share of sports cars and light trucks in the major economies as well as the strong and growing demand coming from the petrochemical sector.
Global demand for natural gas grew by 3 percent due to the abundance of relatively low-cost supplies. It noted that China alone accounts for nearly 30 percent of global gas growth.
It also pointed out that in the last decade came half the growth of the world demand for gas from the electricity generation sector. And last year alone, more than 80 percent of the rise came from meeting the needs of industry and buildings.
According to the report, global demand for coal rose by about 1 percent in 2017.
It is saying that this represents a reversal of the downward trend witnessed by the market during the past two years. It explained that this growth is mainly due to the rising demand in Asia, which comes almost entirely driven by an increase in coal-fired electricity generation.
It stressed that renewable energy recorded the highest growth rate compared to any other source of energy in 2017, accounting for almost a quarter of the growth of global energy demand. It pointed to the leadership of China and the United States of this unprecedented growth; they jointly contributing about 50% of the increase in electricity generation based on renewable energy, and then the European Union came in third, then India and Japan. It noted that wind power accounted for 36 percent of growth in renewable energy production.
Global demand for electricity rose 3.1 percent, well above the overall increase in energy demand. It also pointed to the formation of China and India about 70 percent of this growth, which increased the output of nuclear plants due to the presence of a large amount of new nuclear capability that completed the first year of operation in 2017. It pointed to a slowdown in global energy efficiency improvements in the last year due to lower energy prices and a decline in rigor in implementation.
In addition, the specialized report of "World Oil" International expected continuance of the high crude oil prices in light of signals from Saudi Arabia, the largest oil-exporting countries that supports extension of production restrictions after the end of the agreement by the end of this year. It is saying that these signals add momentum to further recovery in prices and to accelerate the restoration of balance in the market.
The report emphasized that New York's oil futures contract rose 5.4 percent last month, which erased the losses in February due to growing US stockpiles.
The report highlighted the assertion of Iraqi oil minister, Jabbar al-Allaibi, at an energy conference in Baghdad recently that some oil producers from OPEC allies are considering extending the efforts to restrict production to limit global supplies until the middle of next year. The report quoted international analysts as they were saying that the possibility of extension of OPEC for the period of work by agreement rather than stop the agreement by the end of this year is a very positive development. It pointed out that this trend shows that OPEC is serious about continuing to get a stable price of crude oil. The report also pointed to a recovery in the price of crude oil by more than 50 percent since last June.
It pointed to the restoration of the record price that hikes this month after the rise of geopolitical concerns, especially after the appointment of President Donald Trump to John Bolton as a national security adviser.
Prompting speculation that sanctions would be renewed against Iran, OPEC's third largest producer.The report promised that the rapid rise in US crude production - which has exceeded 10 million barrels per day since early February - has increased pressure on prices, which remained below a three-year high of $ 66.66 a barrel in January. The report highlighted the emphasis of Mohammed Barkindo, the Secretary General of the Organization of the Petroleum Exporting, in Baghdad recently that the group of producers participating in the agreement to reduce production, both in OPEC and outside- search for long-term cooperation with other producers.
In the United States, the latest data from the Energy Information Administration showed that as crude oil inventories rose, while petrol supplies declined. BNP Paribas strengthened its forecast for WTI and Brent crude in 2018 amid OPEC efforts to balance Markets, and the geopolitical implications of tensions between the United States and Iran.
The report quoted international analysts as they said that the fundamentals of the crude oil market are very strong at the moment. It pointed out that the market is witnessing a very strong demand for oil around the world, especially with the beginning of the second quarter and the occurrence of the exit of refineries from maintenance, which is likely to see a very narrow market.
Oil prices rose at the end of last week as the global stock markets rose. While traders are evaluating an increase in US crude stocks and production in return for continued supply constraints. According to Reuters, the world's benchmark Brent crude finished up 74 cents, 1.06 percent, to settle at $ 70.27 a barrel. US LME crude futures closed up 56 cents, 0.87 percent, at $ 64.94 a barrel.
Oil prices have risen about 4 percent since January, marking the longest series of quarterly gains since late 2010."The stock market is climbing, which is giving oil support," said Philippe Strebel, chief market analyst at RJO Futures in Chicago.
The three main indexes of US stocks jumped at the end of the week. While the dollar stabilized against a basket of major currencies, which also gives support for oil prices.
A strong commitment to supply cuts by members of the Organization of the Petroleum Exporting Countries (OPEC) and allies like Russia helps support the oil market. OPEC and its allies are likely to continue to abide by their agreement on production cuts until the end of 2018, OPEC sources said. But growing supplies in the United States put pressure on prices. US crude inventories rose 1.6 million barrels last week, while production hit a record high of 10.43 million bpd.
A weekly economic report published by Baker Hughes Oil Services showed a decline in the number of oil platforms operating in the United States this week, for the first time in three weeks, despite the stability of oil prices near the highest levels in three months. The company said in its report that the number of platforms decreased by six platforms, to 798 platforms. The number of platforms is a preliminary indicator of future oil production levels.
