The recession could slash future oil production and set up another price spike, IHS-owned Cambridge Energy Research Associates warned.
The recession could slash future oil production and set up another price spike, IHS-owned Cambridge Energy Research Associates warned today.
In its new report "The Long Aftershock", CERA estimated that of total potential net growth of 14.5M bpd from 2009 to 2014, 7.6M bpd is now ?at risk?.
If at-risk production doesn"t come onstream, CERA warned that global production capacity in 2014 would total 101.4M barrels a day, versus its pre-pricing collapse projection of 109M bpd.
This could create ?a new period of tight supply and strongly rising oil prices?.
Projects most likely to be postponed include heavy oil and deepwater projects, developments in countries with ?difficult fiscal regimes? and new biofuel, gas-to-liquid and coal-to-liquid projects.
The scope of the production shortfall will depend on when demand rebounds, with CERA predicting that global oil demand could drop by up to 2.3M bpd in 2008 and 2009 combined.
According to CERA chairman Dan Yergin: ?Future demand is particularly uncertain today because of the impact of high prices on consumers, the depth of the recession, the shifts in the automobile industry and the introduction of new energy and climate change policies.?