Barrel of crude for $51 in 2025?

From combined dispatches

Crude oil prices will increase gradually and reach $51 a barrel by 2025 because of inflation and rising energy needs in developing nations, according to an Energy Department projection.

The report by the department’s Energy Information Administration said strong economic growth in Asia will drive world energy prices in the next decade. The developing world’s demand for energy will nearly double by 2025 with oil, coal and natural gas leading the way.

The report projects global energy demand to grow about 54 percent by 2025. But China, India and other developing countries will see a 91 percent jump as these countries continue rapid industrial development, said the EIA.

Organization of the Petroleum Exporting Countries producers are expected to still be the major oil suppliers in 2025, the report said. They now account for about a third of the oil being pumped.

Crude oil prices have been steadily rising since the late 1990s. The price of light crude closed at $36.72 a barrel yesterday in trading on the New York Mercantile Exchange.

The sharpest jump in demand will come from China and other Asian countries. Demand in the United States also will continue to increase, too. “The United States, China and the rest of developing Asia account for nearly 60 percent of the projected growth in world oil use,” the EIA said.

Coal and oil will remain dominant fuels despite concerns about climate-changing greenhouse gases, the report said.

“Over the past several decades, oil has been the world’s foremost source of primary energy consumption, and it is expected to remain in that position,” the agency said.

Emissions of carbon dioxide, the leading greenhouse gas, will increase from 23.4 billion metric tons in 2001 — the baseline used in the report — to 37.1 billion metric tons by 2025, according to the EIA projections.

Other highlights of EIA long-term energy forecast include:

• Natural gas is the fastest-growing primary energy source through 2025, increasing 67 percent to 151 trillion cubic feet a year. That would be down from the 176 tcf forecast in last year’s report, because of slower projected declines in nuclear power generation and concerns about long-term gas production.

• World electricity demand will almost double by 2025, growing 3.5 percent a year in developing countries from newly purchased home appliances and air conditioning.

• Coal use will grow by 1.5 percent a year, with demand increases in all regions except Western Europe and the former Soviet states in Eastern Europe, where coal will be displaced by natural gas.

• Nuclear power use will increase because of higher generating-capacity rates for existing plants and fewer facilities will be retired. In the developing world, consumption of electricity from nuclear power increases by an average 4.1 percent a year during the forecast period.

• Carbon dioxide emissions will rise from 23.9 billion metric tons in 2001 to 27.7 billion tons in 2010 and 37.1 billion tons in 2025.

The developing world will account for 61 percent of the increase because of reliance on coal and other fossil fuels.