Transport fuel demand to rise from developing nations: WEC

Demand for transport fuel is expected to grow massively in developing countries like India and China over the next 40 years, outpacing the requirement of developed countries by 2025, a report by the World Energy Council (WEC) has said.

The WEC expects that transport fuel demand in the next 40 years will come mainly from developing countries such as China and India, where demand will grow by 200% to 300%.

In contrast, the transport fuel demand for the developed countries will drop by up to 20%, mainly due to increased efficiencies.

The demand of the developing countries is expected to surpass that of the developed countries by the year 2025.

The report also sets out that oil may still fuel more than 80% of the global transport sector for the next 40 years due to strong demand growth from the heavy duty sector, shipping and air traffic.

By 2050 WEC projects that global fuel demand in all transport modes could increase by 30% to 82% compared to 2010 levels.

The dramatic increase was revealed in the Global Transport Scenarios to 2050 study, presented by the WEC at the World Petroleum Congress in Doha yesterday.

The result of this year-long study describes potential developments in global transport fuels and technology systems on basis of two distinct scenarios; 'Freeway' and 'Tollway'.

The 'Freeway' scenario envisages a world where pure market forces prevail to create a climate for open global competition and solutions which are driven by lowest cost and the private sector.

The 'Tollway' scenario describes a more regulated world where governments decide to intervene in markets to promote early adoption of alternative technology solutions and invest in public transport infrastructure putting common interests at the forefront.

"The Freeway and Tollway scenarios describe two extreme ends of the potential future of transport. The reality will inevitably be between these two scenarios with regional differences playing a major role," Prof Karl Rose, Director of Policy and Scenarios at the World Energy Council said.

"It is, however, evident that the transport sector is about to go through a radical change. The light duty vehicle sector in OECD countries will be almost completely transformed in terms of fuel mix and we will see a pronounced shift of demand for transport fuels to the developing countries," he said.