The Head of Gazprom Neft Called Increasing Oil Production a Non-Trivial Task
Demand for oil will grow beyond 2030, but ensuring an increase in its production is not an easy task, said the head of Gazprom Neft, Alexander Dyukov, in his lecture at the Russia Forum.
According to him, humanity will not be able to do without oil, at least for the next few decades. The demand for energy consumption in the world will continue to grow and will be driven by the growth of the world population and the global economy.
“The oil industry has protected, guaranteed segments in this energy balance. If we talk about oil fuel, then this is the segment of air transportation, sea transportation and heavy freight transport. There are essentially no alternatives to oil fuel. The market for non-fuel products, where there are alternatives to petrochemical products, will also continue to grow also no,” Dyukov emphasized.
According to Gazprom Neft, global oil consumption is currently 5 billion tons per year, and by 2040 it will increase to 5.7 billion tons per year.
Dyukov emphasized that the share of electric vehicles will grow, but the complete replacement of electric motors with internal combustion engines is a complex, inertial process and will take a long time. He cited data that in 2023, the production and sales of electric vehicles accounted for 16% of sales of all cars, but at the end of 2023, the share of electric vehicles accounted for only 3% of the global vehicle fleet.
Additionally, a barrier to electric vehicles and green energy is the limited supply and high cost of lithium and other rare earth metals used in batteries, as well as a lack of charging infrastructure.
Also in the company’s slides, the limitations of green energy are the instability of generation from renewable energy sources (RES), its high cost and the need for large areas.
“This makes many experts believe that oil consumption will grow beyond the horizon of 2030,” Dyukov noted, recalling that some analysts predicted a peak in consumption in 2019, but it is clear that in 2023, 2024 and 2025 consumption will grow and is already significantly higher than 2019.
“So, oil consumption will increase, but will we be able to ensure production growth? This is a non-trivial task,” he said.
According to Dyukov, the conditions for oil extraction have become significantly more complicated, and there are almost no simple reserves left. Now we need new technologies, digitalization for working in remote and Arctic regions, etc.
