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FOCUS 22


Geographies and new developments


We have seen some extraordinary changes in world energy markets in the recent past – in supply, technology and demand. In 2012, the US recorded the highest growth in oil production with the onset of production from shales, and that’s a trend that is here to stay.


As well as seeing new sources of growth on the supply side, we are also seeing demand continue to shift towards emerging markets and non- OECD countries. Two decades ago, demand from these countries stood at 42 percent; today it is 56 percent and that upwards trend will continue to 2030, according to our estimates.


However, while new sources and new levels of demand are very much a new reality for the Oil & Gas market, there are some constants. Russia remains incredibly important in terms of its prospects, and the Middle East is still a very important part of the world in the oil market, in particular because of the role of OPEC.


The industry is facing some important questions in the face of these new realities. With the shale gas revolution in the US, for example, will we see the US exporting those supplies and, if so, in what kind of quantities? And what role will technology play when it comes to unleashing potential?


New world order


In terms of how BP views this new world order, I believe we have to look at exploration and production and the consumer, or downstream, sides quite distinctly from each other.


As far as supply is concerned, we go where the resources are, but also where there is a set of


Dev Sanyal, Executive Vice President and Group Chief of Staff, BP Plc


fi scal conditions that make it attractive to do business; that will be an important factor in the decision-making process.


As far as downstream activities are concerned, we are responding to increased demand in markets like India and China. If you look at our relationship with Reliance Industries in India, for instance, what we are doing is developing India’s indigenous gas production, which ultimately will be consumed by a country with extraordinary energy poverty.


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RUSSIA REMAINS INCREDIBLY IMPORTANT IN TERMS OF ITS PROSPECTS, AND THE MIDDLE EAST IS STILL A VERY IMPORTANT PART OF THE WORLD IN THE OIL MARKET...


© 2013 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member fi rm of the KPMG network of independent member fi rms affi liated with KPMG International Cooperative, a Swiss entity. All rights reserved.


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