TORONTO, Sept. 11 (UPI) -- Rising oil consumption among producing nations will cut exports by 2.5 million barrels per day by the end of this decade, a new Canadian study says.
The study by Toronto-based CIBC World Markets found that soaring rates of domestic oil consumption among OPEC members, Russia and Mexico, which account for 60 percent of production, will reduce exports.
Last year OPEC, Russia and Mexico together consumed more than 12 million bpd, surpassing Western Europe to become the No. 2 oil market in the world, the study said. A major reason for this: highly subsidized gasoline prices.
"Domestic demand growth of as much as 5 percent per year in key oil producing countries is already beginning to cannibalize exports and will increasingly do so in the future as production plateaus or declines in many of these countries," says Jeff Rubin, chief economist at CIBC World Markets, in a statement. "At current rates of domestic consumption growth in the Middle East, OPEC's future export capacity must be increasingly called into question. Similar trends of rising domestic consumption are now evident in Russia and Mexico as well. These trends are likely to result in a sharp escalation in world oil prices over the next few years."
The fall in exports is likely to force the world to look at unconventional deposits such as Canadian oil sands, the study says. Canada's oil consumption fell last year, it said.
