World Energy Outlook 2007

Table 3.2: Fossil-Fuel Prices in the High Growth Scenario
(in year-2006 dollars)
unit 2006 2010 2015 2030
Real terms (year-2006 prices)
IEA crude oil imports barrel 61.7 64.4 66.8 87.0
Natural gas
US imports MBtu 7.2 8.0 8.6 11.1
European imports MBtu 7.3 7.2 7.7 10.3
Japanese LNG imports MBtu 7.0 8.0 8.6 11.0
OECD steam coal imports tonne 62.9 57.6 60.9 72.7
Increase over the Reference Scenario
IEA crude oil imports % 0 9 17 40
Natural gas % 0 9 17 40
OECD steam coal imports % 0 3 7 19
Note: 2006 prices represent historical data. Gas prices are expressed on a gross calorific-value basis. All prices are
for bulk supplies exclusive of tax.
An increase in energy and other raw-material costs alters the relative
profitability and competitiveness of the production of goods and services. In
the long term, it leads to a shift towards less energy- and more capital-intensive
productive capacities. Because of inertia, sectors using equipment with a long
life are particularly vulnerable to a loss of competitiveness. The magnitude of
this effect is related to the rate of growth of the sector as the penetration of new
efficient equipment is fastest during a period of rapid economic growth. It also
depends on the availability of cheap finance that could facilitate early scrapping
of inefficient capacities. In industry, the share of energy in total production
costs increases in all regions in the High Growth Scenario, but to differing
degrees. The increase, compared with the Reference Scenario, averages 16% in
the OECD, 12% in China and 22% in India. The differences are explained
mainly by differences in the rate of change in energy intensity.
International Trade
In the High Growth Scenario, worldwide trade in goods and services expands
much faster than in the Reference Scenario, as the relative competitiveness of
China’s and India’s exports improves (Figure 3.8). Global inter-regional trade
is 12.5% higher in 2030. China’s share of international trade in 2030 increases
from 9.2% in the Reference Scenario to 10.2% in the High Growth Scenario.
India’s share grows from 1.7% to 2.1 %.
Higher commodity costs also affect trade balances and currency flows.
Commodity exports are an important source of income for some regions, while
imports account for a large share of total expenditure in others. The
152 World Energy Outlook 2007 - GLOBAL ENERGY PROSPECTS: IMPACT OF DEVELOPMENTS IN CHINA & INDIA