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Global Energy Demand to Increase by 40% -OPEC

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oil rig - Investors King
  • Global Energy Demand to Increase by 40%

The Organisation of Petroleum Exporting Countries, OPEC, has said that the total global primary energy demand will rise by 40 percent or 108.2 million barrel of oil equivalent per day (mboe/d), by 2040. The sharpest rise would be recorded in developing countries.

In its world output report for 2016, OPEC stated: “Developing countries’ energy demand will increase by more than 100 mboe/d from 2014 to 2040 compared to energy demand growth of 3.3 mboe/d in the OECD regions and 4.3 mboe/d in Eurasia.

“By 2040, almost 63 percent of global energy demand will stem from Developing countries, compared to the current share of 51 percent.”

The report also said that oil is expected to remain the fuel with the largest share for most of the forecast period, but it is anticipated that it will be overtaken by gas at some point close to 2040.

According to the report, oil is also estimated to be the second largest contributor to additional energy needs between 2014 and 2040. Although overall, coal consumption is forecast to increase in the long term, its share in the total global energy mix is expected to decline by 4.4 percentage points.

Global gas demand increment

The report projected global gas demand increment on average by 2.1percent per annum, from around 60 mboe/d in 2014 to 102 mboe/d in 2040. This represents the largest increase among all energy sources.

Also, nuclear power is expected to increase significantly over the forecast period, driven by energy security and the need to limit CO2 emissions.

Other renewables which include wind, Photo voltaic, PV, solar thermal and geothermal is expected to increase from 3 mboe/d as at 2014 to 18 mboe/d in 2040 bringing its share in the global energy mix to almost 5 percent.

OPEC said, globally, energy intensity, measured as the amount of energy required to produce one unit of GDP, is falling and this trend is expected to continue over the long-term.

“Energy consumption per capita in OECD regions peaked around 2005 and is now on a steady downward trend. This reflects a service-oriented economy and technology-induced energy efficiency gains.

“In emerging and developing economies, energy consumption per capita is increasing, reflecting greater electrification, urbanization, expansion of the middle class, overall economic development and strong economic growth.

Despite this positive trend, energy poverty and access to affordable, reliable and modern energy for all will remain a major challenge in developing countries,” the report stated.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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