IEA doubles forecast for oil price by 2030

Posted by Tim

November 10, 2008

IEA doubles forecast for oil price by 2030 - International Herald Tribune.

The International Energy Agency apparently believes the current pull back in energy prices is just a downward blip in the longer term increase of oil prices. Last year the agency forcast a nominal oil price of $108 per barrel by 2030. This year they have increased their projected price to $200.

They forecast global demand to grow by 1% per year from the current 85 million barrels per day to 106 million barrels per day in 2030. Demand for all energy is forecast to grow by 1.6% per year.

Energy costs are very cyclical and have dramatic increases or decreases against small changes in global economic growth. Speculative excesses play a major roll in the dramatic price swings, but this current down turn in energy prices may be short lived.