Regional demand eats into Asian oil exports

Regional demand eats into Asian oil exports

SINGAPORE (AFP): Rising demand among Asia-Pacific oil- producing countries will lead to a decline in crude export availability, increasing the region's dependence on the Middle East, an expert said yesterday.

Kang Wu, an analyst from Hawaii-based think tank East-West Center, told an industry conference here that available crude exports from the region would decline from 2.2 million barrels per day in 1995 to 1.6 million barrels in 2000.

The figure would fall further to 450,000 barrels a day by 2010 while regional output stays at the same level, Wu said.

Regional crude oil production in 1995 was 7.1 million barrels per day, with China, Indonesia, Malaysia, India and Australia accounting for more than 90 percent of the output.

Of the total, 4.9 million barrels per day were used to meet the oil producers' own demand and the rest was exported, mostly to countries within the region, according to Wu.

China, Indonesia, Malaysia, Australia, Brunei, Vietnam and Papua New Guinea all export crude oil.

Wu said demand within the oil-producing countries was increasing fast, reducing export availability, while regional output is expected to reach just 7.2 million barrels per day in 2000.

"Dramatic changes will likely occur among the seven traditional exporters of crude oil over the next 10 years," Wu said. "By 2000, these seven countries will still be exporting crude oil, albeit at a lower amount on the regional basis.

"By 2005, many of these countries are expected to continue to export oil - but a drastically reduced amount," he said, adding that Burma could export "some oil" as well.

The expert described the Asia-Pacific as the "engine of growth" for global energy demand.

In 1995, net oil import requirements of the region amounted to 10.4 million barrels a day, about 59 percent of consumption.

"Based on our forecasts and projections, the region's overall oil import dependence is expected to rise to 66 percent in 2000, and 72 percent in 2005, and by 2010 to 77 percent," Wu said.

Many countries in the region plan to expand their refining capacity to meet rising local demand, and some 6.3 million barrels per day of additional capacity is expected to come on stream by 2005.

"The huge and expanding refining capacity in the Asia-Pacific region implies that crude oil will account for most of the oil import dependence, and dependence on the Middle East to supply the region's crude needs will be inescapable," Wu said.