Demand for Crude Oil

The Transportation sector, being the largest among the commercial, industrial and residential sectors has witnessed an increase in demand for crude oil during the recent decades. Vehicles used for personal purpose and which are powered by internal combustion engines have contributed largely to the growth in demand for crude oil. The transportation sector also played a significant role in the major consumption of oil during 2006. Due to rapid urbanization and the improved standard of living in the developing countries, oil has become essential and it is consumed at a higher rate. Demand for crude oil is also influenced by the increase in the population growth globally.

In 2009 the global demand for crude oil was 85.0 million barrels per day and it is expected to escalate to 86.6 million barrels per day in 2010 with a gain of 1.6 million barrels per day when compared to the consumption level during 2009. The International Energy Agency or IEA has envisaged that the growth in demand for crude oil will be seen in Asia and other developing countries whereas the demand will remain constant in the developed countries like North America and Europe. Thus 2010s oil consumption will account for an average of 41.2 million barrels per day driven by the Non - OPECD (Organization for Economic Cooperation and Development) countries.

Due to the increasing global demand for crude oil, the prices have risen drastically. By 2025, an addition of 44 million barrels of crude oil per day will be pumped out by the world's major oil producers. According to the International Energy Agency (IEA), demand is predicted to rise to 86.6 million barrels per day. The United States and Canada consume oil expansively for the purpose of transportation than for heat and power but the rest of the oil consuming countries follow the opposite pattern where oil is used for heat and power than for transportation. Between 1995 and 2005, the consumption level rose to 17.7 million barrels per day to 20.7 million barrels per day in the world's largest consuming country, which is the United States of America.

China has become the world's second largest energy consuming country after United States of America. Flourishing economic countries like India and China are becoming huge oil consumers. China exceeded Japan in oil consumption during the year 2004 thus becoming the world's second largest oil consumer. Between 1999 and 2004, China doubled its oil imports. In 2004, India's consumption rate was two million barrels a day. The International Energy Agency (IEA) has predicted a rise in demand for crude oil in China to range between 130000 barrels a day to 9 million barrels a day with an increase of 6.2% from 2009. The oil imports in China during 2009 recorded to 4.1 million barrels per day and it is expected to increase to 4.5 million barrels per day in 2010. It is estimated that by the year 2025, China would surpass the Unites States of America as the world's largest oil consuming country as the demand for crude oil is expected to increase by five to seven percent a year.

demand for crude oil