Fatih Birol, executive director of the International Energy Agency (IEA), said Thursday, that global oil demands will grow and oil prices will gradually increase and markets will balance by 2020 at US$ 80 per barrel.
Speaking at the official Brussels launch of the World Energy Outlook 2015, he said that oil and gas production costs despite the advanced modern technology to extract it from under the ground will increase and is one of these reasons that oil and gas prices will be higher in the future than today.
He also dismissed speculation that oil prices will remian around US$ 50 for the next ten years.
"Oil prices to remain at US$ 50 for another ten years or beyond two things are important. One, none of the non OPEC producers such as the US, Russia, Brazil, Africa will be able to produce profitably at US$ 50," said the international oil expert.
"Second, we need to see a stable Middle East and stability in oil production from key Middle East countries including Iran which is something unlikely," he added. Birol who hails from Turkey was named by Forbes Magazine as one of the most influential people on the world's energy scene.
He said the US shale oil which is the main driver of the oil crisis today will not be resilient to the low oil prices. The US shale oil production will decline by almost 3 mbd in five years. The bulk of those shale oil deposits will make commercial sense if the prices are between US$60-70 in the US, he noted. This conference was co-organised by the Paris-based IEA and the Brussels-based think tank Friends of Europe.