Study for Asian Energy Demand and Supply Outlook

Introduction

This is a report on Asian Energy Demand and Supply Outlook, which was conducted by the Institute of Energy Economics, Japan on commission from the Agency for Natural Resources and Energy of the Ministry of Economy, Trade and Industry.
In order to stabilize the international energy market, it is necessary to secure investments sufficient to prevent a tightening of the supply-demand balance. This is a consensus of the international community based on the experience of the volatility of the crude oil prices in recent years. Under these circumstances, Middle East oil-producing countries, which undertake a large portion of the investments in the energy sector, including oil, have pointed out the importance of increasing the foreseeability of future demand as a condition for making adequate and appropriate investments. Therefore, at the Asian Ministerial Energy Roundtable hosted by Japan in April this year, an agreement was reached on “aiming to project supply and demand in the region under the influence of the current financial turmoil for promoting mutual better understanding of the market prospects” with the support of experts from Asian resource-producing and -consuming countries.
Although the projection of supply and demand worldwide, including Asia, has already been made by international organizations such as OPEC and the IEA, until now there has not been an international attempt to project supply and demand with the direct involvement of experts from major oil-producing countries and emerging countries in Asia where demand is expected to rise sharply.
This research program aims to project medium- and long-term energy supply and demand in Asia (covering a period of around 2020-2030) in a way that more accurately reflects the actual situations and circumstances of individual countries in cooperation with experts from major oil-producing countries and emerging countries in Asia, thereby contributing to the securing of adequate and appropriate investments.

From the above-mentioned perspective, in this research program, by bringing together experts from major Asian countries who have knowledge and skills concerning the projection of energy supply and demand and policy analysis that are necessary for the process of making projections, and by sharing perspectives on issues and problems and by sharing the various processes of projection, such as the projection techniques and approaches, setting of scenarios and the deduction and analysis of the conclusions, we will formulate the projection of supply and demand. Thus, both oil-producing and -consuming countries will be involved in the formulation of the projection of future supply and demand that more accurately reflects the actual situations and circumstances of individual countries, thereby deepening their mutual understanding.
In preparation for this research program, we obtained information and data related to the setting of assumptions and the outlook on future energy supply and demand by conducting first-hand surveys at Middle East oil-producing countries and international organizations that have accumulated know-how related to the projection of supply and demand, such as OPEC and the IEA, as well as by holding workshops participated in by the above-mentioned experts
We hope that this report will contribute to Japan’s future oil and energy policy.

March 2011

*Please note this outlook was finalised before the day of East Japan Great Earthquake, thus does not reflect any impacts of the event.