LONDON: Middle Eastern oil producers face a mountain of challenges in the next two decades as Russia and South America strive to replicate the U.S. shale oil boom, while demand in the region’s domestic markets rises sharply.
Oil major BP forecast in its annual energy outlook that energy production in the Middle East will grow by 37 percent by 2015, while its consumption grows by 77 percent.
As a result, its oil export capacity will erode to as little as 65 percent of production volumes from the current 72 percent, putting additional pressure on government budgets of countries such as Saudi Arabia that depend on oil export revenue.
“The Middle East will surpass the former Soviet Union as the most energy-intensive region in the world ... The region is expected to become the largest consumer of liquids per capita, surpassing North America,” BP said.“By 2035, the region will consume over three times the liquids per person than the global average.”