Mr. President, Excellences, distinguished delegates, ladies and gentlemen. It is my great pleasure to address the 26th International conference “Oil and gas of Turkmenistan 2021”. This prestigious conference continues to grow in scope and stature and it is a must participate event in the calendar for all energy’s take-holders. I would like to thank the government of Turkmenistan and event organisers, State Concerns “Turkmengas” and “Turkmennebit” and State Corporation “Turkmengeology” in partnership with Turkmen Forum and UK based GaffneyCline for graciously extended invitation to OPEC to participate at this very important event.
This year’s conference is dedicated to the 30th anniversary of the Independence of Turkmenistan. I would like to congratulate the heroic people and government of Turkmenistan on this momentous anniversary, particularly Highly Esteemed President of Turkmenistan, His Excellency Gurbanguly Berdimuhamedow. With its rapidly growing economy Turkmenistan has achieved exceptional results since independence. The oil and gas industry has played an important role in this economic success. Turkmenistan has correctly emphasized the importance of developing partnerships between Turkmen state organizations and international oil and gas companies.
OPEC stands ready to enhance our relationship with Turkmenistan, the range of topics on which we have mutual interest, particularly sustainable stability in the international oil market. OPEC is determined to work with all stakeholders in the energy industry to create opportunities and solve challenges. We believe there is tremendous potential in OPEC Turkmen relations going forward. We are pleased that at the bilateral level our member countries have very productive relations with Turkmenistan. Indeed, we will be a witness to that fact later in this conference.
There will be a live link-up with Dubai EXPO 2020 for session 4 Natural gas an alternative sources of energy, key resources in transition to a low carbon future. The session will be held both at the conference venue in Ashgabat and within Turkmenistan’s Dubai EXPO 2020 exhibition pavilion. OPEC is very proud that our member the UAE is hosting the EXPO and we are delighted that Turkmenistan is participating in such a high-profile way.
OPEC is currently engaged in the declaration of cooperation process whereby we act in unison. We tend on OPEC oil producing countries in contributing to sustainable stability in the global oil market. This is a volatility fighting toolkit and has helped us navigate global challenges including the 2014-2016 downturn in the global oil market and severe contraction in oil demand caused by historic events in 2020.
The declaration of cooperation was signed on 10th of December 2016 in Vienna Austria. As a result of our timely actions the market has withstood major challenges and is in a healthier position today. We have also signed a chart of cooperation with these ten countries on the second of July 2019. The chart of cooperation is a high-level commitment to facilitate dialogue among participating countries aimed at promoting oil market stability, cooperation in technology and other areas for the benefit of oil producers, consumers, investors and the global economy. It is a means of enabling the long term use of oil as a key component in the evolving global energy mix as well as improving the environmental and efficiency credentials of oil. The charter promotes strategies and technologies to advance the global oil industry.
Excellences, distinguished delegates, ladies and gentlemen, the topic of this plenary session is the future of energy and I’d like to share with you some highlights from OPEC’s recently launched 15th edition of our flagship annual publication the World Oil Outlook. It provides an INDEFF review and analysis of the global oil and energy industries and offers us assessment of various sensitivities in the medium or long-term development of the oil industry. A clear conclusion from the all oil outlook is that the world will need more energy in the decades to come. In the period to 2045, the global economy is estimated to more than double.
The world’s population is said to expand to 9.5 billion people. We see global energy demand expanding by 28% by 2045. Energy will be needed to power more homes, more services, more businesses, more cars, more planes and more ships. All forms of energy will be needed to support the energy transition and the affirmation demand growth. Oil is forecasted to retain its number one position in the energy mix. It is still expected to provide 28% of global energy needs by 2045. Global oil demand is projected to reach 108.2 million barrels a day by 2045 up from 90.6 million barrels a day which was in 2020. Following the energy trend it is the non OECD that dominos oil demand growth lead by India, China, other Asian countries and OPEC. Gas demand is expected to increase by 21.6 million barrels of oil equivalent by day between 2020 and 2045. This brings total gas demand to 85.7 million barrels of oil equivalent by day in 2045, that is, becoming the second largest foil in the energy mix.
By sector, road transportation leads the way followed by aviation and petro-chemicals, while electricity generation is the only area expected to see an oil demand decline. Huge potential exists for an expansion in the passenger and commercial vehicle fleets, especially in developing regions with lower motorization rates and promising economic prospects. Conquered with an increase in the number of vehicles on the road, it is a considerable rise in the number of electric vehicles. In fact, the number of electric vehicles is set to up 4500 million by 2045, representing almost 20% of the global fleet by then. However, at over 76% by 2045 the internal combustion engine vehicles are set to retain the largest market share with oil demand in the road transportation sector expected to stay at around a level of 4 to 6 million barrels a day after 2025. The key to the industry’s expansion is investments.
This year’s world oil outlook shows that investments of about 11.8 trillion USD will be required between now and 2045 in the upstream, midstream and downstream sectors. There can be no doubt that the global future will be focused on shrinking global emissions alleviating energy poverty and finding a sustainable way forward that delivers for each and every person on this planet. It is vital to tackle both climate change and energy poverty within the context of sustainable development and the UN SDGs with SDG 7 calling for universal sustainable energy access.
The energy transition should not be about selecting one form of energy over another, we all need to embrace all energies and keep our sides on energy security, and reducing emissions all we could see unintended consequences. OPEC and its member countries have been directly involved in the evolution of the UN’s framework on conventional climate change, the Kyota protocol, and the Paris agreement. I fully support the multilateral approach to address the climate change and the energy transition. The core elements of the UNFCCC particularly equity, historical responsibility and national circumstances must be considered at all junctures moving forward.
There is no doubt that the oil and gas industry can foster its resources and expertise and help lock over emissions for the future through its role as a powerful innovator, developing cleaner and more efficient technological solutions.
We need to continually highlight the importance of environmentally and economically effective policies that are equitable and just as well as fair and inclusive strategies that insure no one is left behind. It is a core belief of OPEC’s that the only way we stand a chance of finding solutions to the world’s problems is through dialogue, cooperation and mutual respect among all nations.
The focus is on multilateralism as I am here to discuss the reason I lay a path forward for us all.
Excellences, distinguished delegates, ladies and gentlemen, allow me to conclude by once again thanking Turkmenistan for organizing this prestigious conference. OPEC stands ready to expand and enhance relations with Turkmenistan. I wish all the participants a successful conference and fruitful discussions. ///nCa, 29 October 2021