Biggest annual increase in US oil productionStaff writer ▼ | Monday June 17, 2013 3:02AM ET
The US recorded the world's highest growth in production of both oil and natural gas in 2012, on the back of increasing production of unconventional hydrocarbons such as tight oil, an example of the increasing diversity of energy sources as the global market continues to adapt, innovate and evolve. With rising natural gas output driving prices lower in the US, natural gas displaced coal in power generation, causing the US to experience the largest decline of coal consumption in the world.
Elsewhere, the 62nd annual report states, 2012 saw the largest annual decline in world nuclear output. In Japan, where nuclear power generation all but disappeared after 2011's Fukushima accident, higher imports of fossil fuels including liquefied natural gas (LNG) ‘kept the lights on'. In Europe, where gas prices were higher than in the US, power generators took the opposite course from the US, and substituted coal for gas.
"For those of us in the energy industry, the challenges are about how we respond to the big shifts we are seeing - a shift in demand towards emerging economies and a shift in supply towards a greater diversity of energy sources, including unconventionals. The data show there is ample energy available. Our challenge as an industry is to make the best choices about where to invest," said Bob Dudley, BP group chief executive.
The Review also revealed a drop in the growth of overall global energy consumption to 1.8% in 2012, down from 2.4% the previous year. This was partly as a result of the economic slowdown, but also because individuals and businesses responded to high prices by becoming more efficient in their use of energy.
The emerging economies - the non-OECD countries - firmly established themselves as the source of what demand growth was seen, with China and India alone accounting for nearly 90% of the increase. Just twenty years ago, the emerging economies accounted for only 42% of global consumption; now that figure is 56%.
Hydroelectric and renewable energy (along with cheap natural gas in North America) competed against coal in power generation. Global biofuels output fell for the first time since 2000 due to weakness in the US, but renewables in power generation grew by 15.2% and accounted for a record 4.7% of global power output. ■