Azernews.Az

By Fatma Babayeva

Today’s low oil prices may rise in coming 3-5 years, said Spencer Dale, Chief Economist of BP Group as he met Azerbaijani Energy Minister, Natig Aliyev to present BP Energy Outlook 2016.

Future demand and tendencies in energy sector and current situation of the energy market were among the issues discussed during the meeting. The report includes long-term energy trends, forecasts of world energy markets over the next 20 years, Azertac reports.

Dail emphasized that although the Doha meeting of top oil producers failed to freeze production in the market, it partly helped to stabilize the market.

The expert believes that the reduction in investments in the oil sector by 35 percent compared to 2014 will have further impact on sales in the markets, which will inevitably lead to an increase in oil prices. Dale expects a growth in demand for crude oil and higher prices in the next 10-20 years.

The expert further stressed possible impacts of the economic transformation process going on in Saudi Arabia on the oil prices, which is one of the key players in the energy market.

In his turn, Natig Aliyev stated that the production at low prices would be undesirable also for countries such as Saudi Arabia, Iran and Libya that seeking to increase oil production.

"Most likely, the price of oil will be set at around $50/barrel,” he said, adding that it seems unlikely that oil prices will surge to $100 in near future.

BP analysts say that an increase will be observed in the prices and demand in the gas market in the next 20 years. The desire of many countries to replace coal with gas and decline of gas production in Europe will lead to an increase in its dependence on imported gas to 75 percent.

Moreover, supply of liquefied natural gas is increasing. Europe is the main consumer market for LNG. Currently, the U.S. is also becoming a decisive player in the LNG market.

Aliyev said that in contrast to forecasts that Europe's consumption of natural gas will reach 500 billion cubic meters, and by 2030 this figure will grow to 300 billion cubic meters, at the moment, decline in consumption is observed.

The minister did not rule out that a gradual transition to the use of electricity in the engineering industry in developed countries will lead to changes in the energy balance in the near future.

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Fatma Babayeva is AzerNews’ staff journalist, follow her on Twitter: @Fatma_Babayeva

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