The Secretary General of the International Energy Forum and the President of the King Abdullah Petroleum Studies and Research Center welcomed participants in the Third IEF-KAPSARC Thought-Leaders’ Roundtable discussion on oil markets at IEF headquarters in Riyadh on 16 February.
Discussions focused on the theme: "Post-Paris Agreement: A World of Peak Oil Demand?"
Many of the parties to the ‘Paris Agreement’, that entered force on 4 November 2016, anticipated that its subsequent implementation would lead to a world of peak oil demand. However, the transition through a demand peak, should investors expect it to arrive within the time horizons of their medium-term oilfield developments, might increase price volatility. Paradoxically, a reduced reliance on fossil fuels among consumer nations might lead to periods of supply shortage while at other points of an accentuated cycle, exporters may compete for market share after giving up hope of a rebound in prices.
Energy Ministers gathered at the 15th International Energy Forum on 26-28 September 2016 called for an enhanced role of the producer-consumer dialogue and greater market transparency. An inclusive and energy-technology neutral dialogue among producing and consuming countries will offer more clarity to investors and market participants, and so may contribute to a more orderly and cost efficient transformation of energy markets. On one hand, this will facilitate more orderly transitions between investment cycles in the interest of overall energy market security. On the other hand, accelerated deployment of energy efficiency and new energy technologies in oil producing and consuming growth markets will foster energy productivity gains across regions and help reduce greenhouse gas emissions more swiftly, placing global economic growth on more advanced and healthier footings.
The 3rd IEF-KAPSARC Thought Leaders’ Roundtable invited thought leaders and government and industry representatives to collectively look beyond the corners of these policy turns and physical market developments to assess what their likely impact is on the dynamics of global oil supply and demand in the medium and long term.
This roundtable launched a year-long engagement to explore scenarios for producers and consumers navigating the transition to a lower carbon energy future. During the year, participants will be invited to contribute intellectually to the development of modelling infrastructure to describe the transition and its impacts on the global economy - particularly the risks of increased volatility in the oil market and the potential impacts on international energy relations. Workshops in The Netherlands, Dubai, UK and Saudi Arabia with a joint study report to be issued late in 2017.