Wednesday, November 23, 2011

Gas shortages in the Middle East?

According to David Barringer, Oil & Gas Leader, Ernst & Young MENA, "While the energy strategies adopted by some countries in the Middle East may help improve their energy independence in the longer-term, in the short-term the region's requirements will also have to be met by imported gas."

There is growing talk that there are natural gas shortages in the Middle East as demand for power has increased. What if there is a natural gas shortage? Or what if there is less gas available for export to other parts of the world? The oil politics will change and the idea that we are ready for a new age of natural gas will only be a good news story.

Gas is supposed to grow at over 6 percent while oil usage may only grow at 2%.  41% of the world's proven reserves are in the region, but 73% are located in two countries Qatar and Iran. Qatar has a current moratorium new filed developments until 2014. There is not an even mix of supply across the Middle East. There are now problems with power and industry usage have to fight for access to natural gas. This is occurring in Kuwait with industrial demand actually falling over the last few years.

The gas bubble in the US is not shared with the rest of the world.

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