Global demand for liquid fuels in 2019 topped 100 MMbbl/d for the first time but the COVID-19 pandemic will likely reshape economic, political and social trends in unforeseen ways, BP Plc said June 17 in its annual Statistical Review of World Energy.

“It feels like the world is at a pivotal moment: it needs to address these short-term concerns but in a way that builds back better,” Bernard Looney, the energy giant’s CEO, wrote in the report’s introduction.

All fuels, except nuclear, grew at a slower rate than their 10-year averages, the report said. Total energy consumption grew at 1.3% in 2019, less than half the rate of 2018. Oil consumption was up 900,000 bbl/d, led by China with an increase of 680,000 bbl/d. Industrialized economies reduced their consumption by a total of 290,000 bbl/d.

The U.S. led growth in demand for natural gas, increasing usage by 27 Bcm, while demand worldwide rose by 78 Bcm, or about 2%. That fell far short of 2018’s 5.3% but it boosted the share of gas in primary energy use to 24.2%.

The U.S. also generated two-thirds of the growth in global gas production, or 85 Bcm of the world’s 132 Bcm increase. Australia produced 23 Bcm more in 2019 over 2018 and China added 16 Bcm.

LNG supply jumped by 54 Bcm, a record increase. The U.S. led the way, followed by Russia, with Europe expanding its LNG imports by 49 Bcm, or two-thirds over 2018.

Much of the increase in global gas consumption came at the expense of coal, which decreased by 0.6% for its fourth decline in six years. Coal’s share of the world’s energy fell to 27%, its lowest level in 16 years.

In its assessment of the BP report, Simmons Energy listed primary risks for the energy business as:

  • Weak global economic activity resulting in depressed demand for oil and natural gas;
  • Increased supply of oil and natural gas; and
  • Weak capital markets (especially given the capital-intensive nature of the energy business).

In his introduction, Looney expressed concern about the trend of carbon emissions. He noted emissions grew only 0.5% in 2019 but that followed a growth of 2.1% in 2018 and the annual increase in the two years surpassed the average for the last 10 years.

“As the world emerges from the COVID-19 crisis it needs to make decisive changes to move to a more sustainable path,” he wrote.

For the third straight year, U.S. oil production increased more than any other country at 1.7 MMbbl/d. That figure was less than 2018’s 2.2 MMbbl/d increase. Brazil (200,000 bbl/d) and Canada (150,000 bbl/d) also counted among the leaders in growth, but Canadian output did not expand as much as it did in 2017 and 2018.

OPEC production took a 2 million bbl/d hit in 2019, its most dramatic decline since 2009. The report attributed much of that decrease to U.S.-led sanctions against Iran, which saw its output drop by 1.3 MMbbl/d. Political and economic troubles contributed to Venezuela suffering a 560,000 bbl/d reduction in output and Saudi Arabia’s production dropped by 430,000 bbl/d. Other OPEC members were able to grow production, including Iraq (150,000 bbl/d) and Nigeria (100,000 bbl/d).

Crude oil trade suffered its first decline since the 2009 financial crisis, dipping 0.3% or 230,000 bbl/d. Sanctions against Iran cut Middle East exports by 1.4 MMbbl/d. U.S. exports of 900,000 bbl/d were not enough to offset that total. The U.S. also decreased its imports of crude oil by 1 MMbbl/d.

NGL production growth continued its strong long-term trend with a 520,000 bbl/d increase, or 4.5%. Much of that (440,000 bbl/d) came from the U.S., which the reported noted doubled its annual production to 4.8 MMbbl/d between 2012 and 2019.

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