Page 55 - Aamir Rehman Gulf Capital and Islamic Finance The Rise of the New Global Players

40 PART I Background and Context

FIGURE 1.6

Oil Consumption by Region, 2003 and 2030

North America
Non-OECD Asia
OECE Europe
OECD Asia
Central and South America
Middle East
Non-OECD Europe and Eurasia 2003
2030
Africa
0 10 20 30 40
Million Barrels per Day
Sources: 2003: Energy Information Administration (EIA), International Energy
Annual, 2003 (May–July 2005), www.eia.doe.gov/iea/. 2030: EIA, System for
the Analysis of Global Energy Markets, 2006.

While oil consumption is expected to increase everywhere, its
expected growth is most striking in non-OECD Asia—a cluster that
includes China, India, and other emerging Asian economies. In 2003,
non-OECD Asia consumed roughly half the amount of oil consumed
in North America; by 2030, the gap is expected to be much smaller. In
the most developed European and Asian countries (the OECD mem-
ber states within these regions), growth in oil consumption is
expected to be quite modest when compared to other parts of the
world. Growth in basic demand for oil is a factor that drives prices
upward over time.
The steady trend toward increased oil demand is linked to the
general development of these emerging markets. As industry and
urbanization expand, so does the demand for energy. As standards of
living rise, so do the use of automobiles, the transportation of packaged
goods, and so on. It’s also worth noting that when it comes to con-
sumption of oil, emerging markets are likely to be more price-sensitive
than other areas when it comes to the adoption of alternative-energy
sources. Policy makers and consumers in the wealthier markets of
Western Europe and the United States may, because of environmental
or other concerns, choose alternative-energy sources even if they are
somewhat more expensive than fossil fuels. Developing countries, in