Group chief executive's introduction
Energy in 2012 – adapting to a changing world
Welcome to the 62nd edition of the BP Statistical Review of World Energy.
Over the years, this review has established itself in the energy world as a valuable work of reference, documenting the changing patterns in the way we produce and consume our energy.
It provides an annual opportunity to examine the latest data, country-by-country and fuel-by-fuel. This helps us discern the important trends and assess the challenges and the opportunities that lie before us. This edition of the review highlights the flexibility with which our global energy system adapts to rapid global change.
The year 2012 saw a slowdown in the growth of energy consumption globally, partly as a result of the economic slowdown but also because individuals and businesses have responded to high prices by becoming more efficient in their use of energy. At the same time, the review shows that the supply of energy is coming from an increasing diversity of sources as the world’s energy market continues to adapt, innovate and evolve.
Brazil, China, the EU, India, Japan, Russia and the US all saw below-average growth in energy consumption. Indeed, consumption growth of all forms of fossil energy was below average. On the supply side, the most noticeable phenomenon remains the American shale revolution. In 2012, the US recorded the largest oil and natural gas production increases in the world, and saw the largest gain in oil production in its history.
Elsewhere, for a second year, disruptions to oil supply in Africa and parts of the Middle East were offset by growth among OPEC producers. Libyan production recovered strongly after the sharp drop in output in 2011, and Saudi Arabia, the UAE, and Qatar all produced at record levels. However, despite these supply increases, oil prices reached another record high.
Coal remained the fastest-growing fossil fuel, with China consuming half of the world’s coal for the first time – but it was also the fossil fuel that saw the weakest growth relative to its historical average.
While natural gas grew at a below-average rate, it was the only fossil fuel to see consumption growth accelerate in 2012. Cheaper natural gas competed strongly with coal in North America, displacing it as a power feedstock. Hydroelectric and renewable energy also competed strongly against coal globally; renewables in power generation grew by 15%. However in Europe, where gas was more expensive, coal was often the fuel of choice for power generation, while the LNG tankers that used to supply Europe turned towards Asia.
Global nuclear power output had the largest decline ever, with Japanese output falling by nearly 90% as the response to the tragedy at Fukushima continued to unfold. Fossil fuel imports rose to compensate. In these and many other ways, 2012 highlighted the flexibility of the world’s energy market and the innovative approaches that consumers and producers take in response to change.
Our mission as an industry is to find and produce the many forms of energy needed to meet growing demand, safely and sustainably. This review will continue to chart our progress in fulfilling that mission as well as helping to illuminate the options for our future direction.
It is a great source of information for people in government, industry, academia and elsewhere and I hope that you will find it useful.
In concluding, let me thank BP’s economics team and all those around the world who have helped prepare this review – in particular those in governments in many countries who contribute their official data.
Group Chief Executive