Middle East to dominate oil exports by 2050, says Opec

• Bloc reveals long-term outlook
• Demand rising in Asia-Pacific region
• Imports to hit 34m bpd by 2050

The Middle East is forecast to provide almost 60 percent of the world’s oil exports by 2050, according to Opec’s long-term outlook.

Its oil producers are pursuing aggressive marketing strategies aimed at Southeast Asia and the Pacific region, where energy demand is growing.

The Middle East accounted for 49 percent of global crude and condensate exports last year. 

Although the Middle East’s market share is expected to slide slightly until 2030, because of increased supply from Latin America, the US and Canada, the trend should reverse by mid-century, Opec said.

Analysts believe the Middle East will win the long term competition as a result of its low production costs and established markets, especially in the price-sensitive Asia-Pacific region.

Neil Atkinson, an independent energy analyst based in Paris, said the relationship between the Middle East and Asia-Pacific would grow stronger. 

“That is where the growth is and the Middle East [has] the lowest-cost producers with the biggest reserves,” he told AGBI. “They will be able to supply the oil needed for many, many decades to come.”

Asia-Pacific imported around 24 million barrels per day of crude and condensate – wet gas – in 2023. Imports are expected to exceed 29 million bpd in 2030 and rise to nearly 34 million bpd in 2050.

Producers in Saudi Arabia, the UAE and Iraq have signed long-term contracts with countries including China, Japan, India and South Korea to provide stable oil supplies. 

Victor Katona, head of oil analysis at Kpler, said: “People shouldn’t focus on China and Japan and South Korea too much beyond this decade. It’s over, everyone has peaked. South Asia is the new Asia-Pacific, India will grow.”

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Opec is calculating that India will be the largest driver of global energy demand by 2050, accounting for roughly 30 percent. It also expects India to be the world’s fastest-growing economy in the next 25 years, with GDP expanding at an annual average of 6 percent between 2023 and 2050.

However, Middle Eastern producers have been hunting for other markets in Asia, such as Malaysia, Indonesia and the Philippines, as they have lost their market share in India to cheaper sanctioned Russian oil.

Although the long-term outlook for the sector remains uncertain, demand for energy continues to increase.

Forecasts for oil demand diverge, however. The International Energy Agency predicts that global oil demand will peak before the end of the decade, while Opec forecasts oil demand exceeding 120 million bpd by 2050.

Torbjörn Törnqvist, chairman of energy commodities trading company Gunvor Group, told an energy conference earlier this month that fossil fuels – oil, gas and coal – account for 84 percent of the energy mix, the same as it was 30 years ago. 

“I bet you, by the end of this century, it's not going to be much different,” he said.