The price of oil could rise to as much as $150 per barrel in the near term if investment in the oil-producing countries of North Africa and the Middle East is lower than required to meet growth in demand from emerging economies, the International Energy Agency said on Wednesday.
"Growth, prosperity and rising population will inevitably push up energy needs over the coming decades. But we cannot continue to rely on insecure and environmentally unsustainable uses of energy," IEA Executive Director Maria van der Hoeven said in said the organization’s 2011 edition of the World Energy Outlook.
Under the report’s central scenario, energy demand will increase by one-third between 2010 and 2035, with 90 percent of the growth in non-OECD economies.
China will consume nearly 70 percent more energy than the United States by 2035, the report said, even though, by then, per capita demand in China will still be less than half the level in the United States.
Although short-term pressures on oil markets are easing with the economic slowdown and the expected return of Libyan supply, the average oil price will remain high approaching $120/barrel in 2035, according to the IEA.
“If, between 2011 and 2015, investment in the MENA (Middle Ease North Africa) region runs one-third lower than the $100 billion per year required, consumers could face a near-term rise in the oil price to $150/barrel,” it added.
The agency expects oil demand to rises from 87 million barrels per day (mb/d) in 2010 to 99 mb/d in 2035, with all the net growth coming from the transport sector in emerging economies.