Entering the 21st century, many of the present OPEC members are likely to have their export capacity lost or sharply shrinking, and the international oil market is expected to be transfigured into a truly competitive market consisting of several export centers. As a result, crude oil prices will become more dependent than ever on non-OPEC marginal oil fields' supply cost. On the other hand, when plotted based on rather conservative demand estimates, a lifelong supply curve of conventional crude oil turns downwards in around 2010, which means a structural liquid fuel shortage can occur. To fill the potential supply-demand gap requires extra efforts: First, synthetic fuels need to be introduced; Second, remaining recoverable reserves must be boosted by such means as improving recovery rate; Third, energy conservation and fuel switching has to be promoted. At any rate, supply cost is destined to rise. With this background, crude oil prices will reverse from the present weak undertone to a strong, upward undertone in around 2000.

As in the past, oil demand in the Asia-Pacific region will keep growing faster than in the rest of the world, and the region is likely to face several problems: First, with incremental local supply unable to keep up with surging demand, the region's dependence on Mideast oil will sharply increase; Second, particularly China and Indonesia will turn to be net oil importers; Third, increasingly light products-dominated demand, combined with upgraded quality specifications, will tighten supply-demand of both low-sulfur crude oil and light products; Fourth, as a result of tightening supply and demand, all-out efforts must be made for refining capacity expansion pians, including secondary units; Fifth, to help stable development of an Asia-Pacific oil market, it will be crucial to advance joint projects among oil producing countries in the Middle East, LDCs/NIEs in Asia-Pacific, and Japan in various forms, with some devoted for the upstream or downstream sectors, and others for integrated operations. 1. WORLD OIL PERSPECTIVES BY THE EARLY 21ST CENTURY 1 .I. International oil market in the 1990s Considering a likely shape of the international oil market in the 1990s, to what extent producing countries can achieve their capacity expansion plans is a question of crucial importance. By 2000, demand for OPEC oil is expected to be around 1.3 Mm3/d (8.0 million b/d) higher than now. If producing countries realize their current expansion plans, a considerable oversupply could be caused, and crude oil prices would be kept soft, while sharp fluctuations would occur.

However, given a fund squeeze worldwide, producing countries' worsening financial state, and rising cost incurred in developing new produc

This content is only available via PDF.
You do not currently have access to this content.