Demand for oil could exceed supply by 13 million bbls/day by 2030, according to a new study that warned of 'accumulating' risks to energy production and encouraged the use of alternative fuels. Among the risks cited were geopolitical barriers, higher costs, fewer petroleum engineers and growing constraints on carbon dioxide emissions. The 476-page study, titled "Facing the Hard Truths About Energy," involved 350 participants and was led by former Exxon Mobil chairman Lee Raymond. "There is no quick fix [to the problem]," Raymond said. Data collected showed that global production may reach 105-110 million bbls/a day by 2030, an amount that is 11% below U.S. government forecasts for daily demand of 118 million bbls. The National Petroleum Council, an advisory group that conducted the study in response to a request from U.S. Energy Secretary Samuel Bodman, approved the report on Wednesday. "We need energy efficiency, we need to moderate the rate of growth of demand. We need diversity of suppliers and of supplies," Bodman said in response to the report. Top industry executives, private research centers, academic institutions, banks, government agencies and environmental groups also contributed to the report. The study noted that the world was not running out of energy resources, indicating that coal, oil and natural gas would be important resources for meeting increased energy demand. Among the stated recommendations are improving energy efficiency and pursuing unconventional sources of energy such oil from tar sands and shale formations and non-petroleum fuels such as ethanol. The council also urged the U.S. government to start regulating greenhouse gas pollutant carbon dioxide and setting a high enough cost for CO2 emissions to encourage companies to curb them.
Sources: NPC report summary (.pdf), NPC full report (.pdf), Press release, Bloomberg, Reuters
Commentary: Will We Have Too Much Generation for Renewable Energy Projects? • Pay Attention To the Oil Price Naysayers • Investing in Renewable Energy: An Introduction
Stocks/ETFs to watch: United States Oil Fund ETF (USO), Claymore Macroshares Oil Down (DCR), PowerShares WilderHill Clean Energy ETF (PBW), Energy Select Sector SPDR ETF (XLE), iShares Goldman Sachs Natural Resource ETF (IGE)
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