One of the Federal Government’s top infrastructure advisers is warning of an oil crunch that could send the global economy spiralling back toward recession.
Curtin University Professor Peter Newman sits on the Government’s Infrastructure Australia Council and says peak oil – when demand outstrips dwindling supply – has already hit but that the global downturn has kept prices low.
Professor Newman even blames oil for causing the global recession in the first place, and he is not alone.
It is an issue being taken seriously by some local councils which have drawn up peak oil contingencies.
And check out this even bigger news, which whilst hopelessly optimistic, it is still a major step in that it is finally being addressed that SA oil exports can not keep increasing to handle increased global demand:
Saudi oil chief fears domestic risk to exports
Mr Falih said in a recent speech released by Aramco on Monday. “If no efficiency improvements are achieved, and the business is as usual, the oil availability for exports is likely to decline to less than 7m barrels per day by 2028, a fall of 3m barrels per day, while the global demand for our oil will continue to rise.”
It is believed to be the first time a Saudi oil official has so explicitly addressed concerns about the impact of domestic demand on exports. Analysts welcomed the announcement, saying the world’s largest oil producer and exporter needed to tackle the issue now.
Saudi Arabia produces about 8.5m b/d and raised its production capacity to 12.5m b/d last year, reaffirming its role as the world’s key swing producer.
But rapidly rising domestic energy demand and natural gas shortages have meant the kingdom has to burn increasing amounts of crude to fuel power plants, desalination units and new industries as its seeks to diversify its economy.