Nabil Hjiej-Andaloussi
Q. Evaluate the roles of names players in providing future energy security
Managing future energy needs is certainly a global challenge that requires the cooperation of many named players both on a small and large scale. It has been estimated that global demand for primary energy is set to grow 55% by 2030 and that $22 trillion of new investment is need to meet future energy forecasts. The main player in providing future energy security can be argued to be OPEC as they control the production of over 2/3’s of the world’s supply of oil, therefore leading them be price makers in the industry.
OPEC is considered to be the most important player in global energy provision, it currently consists of 12 members and was created in 1960 mainly to protect the interests of member countries and to stabilise oil prices for a regular supply to oil consuming countries. However, OPEC’s obligations have been controversial as they have been accused of holding back on production of oil and gas in order to drive up prices, therefore using the market mechanism of demand and supply to increase profits for member states. Currently it has been proven that collectively, OPEC has stored 900,000 million barrels of crude oil, they own 78% of global resources and have a combined market share of 45% for oil and 18% for gas. This inherently makes them the largest producer of fossil fuels in the world meaning they will have a large if not absolute say in future energy provision and energy security. The responsibility of oil distribution will then fall on OPEC when supply of oil runs low leading to a bidding system for allocation of oil to where demand and price is highest.