The Wilson Center Global Energy Forum provided updated analyses regarding geopolitical situations and their effects on energy production. The keynote speaker, Adam Sieminski of the U.S. EIA, discussed the short-term implication in the growth of demand: a rebalancing between demand and the excess supply caused by OPEC.
Due to uncertainties in the market, such as the Iran Deal (which may provide 600-900k barrels/day), Johnson argues that policymakers should prepare for a wide range of oil prices, ranging from $25-$100/barrel. In the long run, world electricity, renewables, and natural gas production will continue to rise.
The first panel consisted of Robert Johnston of The Eurasia Group, David Victor from the School of International Relations and Pacific Studies, and Amy Myers Jaffe from the University of California. Johnston discussed the rebalancing of demand and supply. He argues that a demand-led recovery will likely occur over a collapse of supply; however, supplies could fall in Iraq, Iran, and Saudi due to geopolitical reasons.
Amy Myers discusses some of these reasons, particularly in relation to the instability in the Middle East. ISIS’s technical ineptitude, for instance, has destroyed 90k barrels/day. This, along with regime change and prolonged conflict, can lead to a “supply hole.”
David Victor’s presentation focused on the need to initiate more market pushes rather than rely on pulls. He calls for collaborative R&D projects similar to that of the human genome project. He also notes that we do not need to have every country involved. Countries that matter remain highly concentrated: 10-12 countries produce ~70% of emissions. David also noted during the Q&A that the Paris agreement will likely have some kind of institutional arrangement on implementation, something he feels is a necessity.
The second panel featured David Goldwyn of Goldwyn Global Strategies LLC and Jan Kalicki of the Woodrow Wilson Center. Goldwyn argued that we need a long-term view for energy security. For example, selling off reserves now due to the current light oil boom makes little strategic sense since it does not account for the future.
He also recommends that we fix and keep the SPR so that we can use it when needed. Goldwyn feels that the market under prices risk while possibly overestimating increases in production. As such, he disagrees with the notion that Iran’s oil supplies will greatly increase.
Jan Kalicki mostly discussed the necessity of considering global forces as they affect energy supplies. He calls for national and regional cooperation.
The post Wilson Center Global Energy Forum Overview appeared first on American Security Project.