UAE fuel demand grew by around 4.6 per cent to more than 223,000 barrels per day in 2007 and industry sources expect it to swell by over five per cent this year.
From nearly 213,900 bpd in 2006, consumption of petrol, kerosene, diesel and other refined products increased to a record 223,800 bpd in 2007, the ministry of economy said in a new statistical report yesterday.
The demand last year was nearly 100,000 bpd higher than the consumption of around 127,000 bpd in 1999, the report said. It showed demand jumped by 64 per cent to 209,500 bpd in 2000 before tumbling to 154,800 bpd in 2001. It recovered sharply to 170,700 bpd in 2002 and continued its steady growth in the following years. The report gave no reason for the sharp fluctuations in demand during 1999-2002.
“I think consumption will rise by at least five per cent this year because of the business upsurge and the high population growth,” said an industry source capital.
A breakdown showed diesel had the lion’s share of demand, reaching 95,600 in 2007, followed by gasoline, which stood at 83,000 bpd. Demand for kerosene stood at only 4,200 bpd, while it was estimated at 21,100 bpd for residual fuels and 19,400 for others.
Demand is met fully from local production in Abu Dhabi, which also supplies other emirates and exports the rest to other markets. In Dubai, retail fuel companies import a large part of their supplies, which explains the widening price gap within the UAE.
Per capita energy consumption in the UAE was estimated at 85.3 barrels of oil equivalent per day in 2007, up from 68.5 boe per day in 2001. It was only second to Bahrain and Qatar in the Arab world last year.
Abu Dhabi’s refining capacity stood at around 485,000 bpd in 2007 and a major expansion project at its Ruwais refinery is expected to double output within a few years.
Ruwais refinery, nearly 250 kilometres east of Abu Dhabi, currently produces around 400,000 bpd while Umm Nar’s capacity is estimated at nearly 85,000 bpd.
According to the Organisation of Arab Petroleum Exporting Countries (Opec), the UAE’s total refining capacity stood at 778,000 bpd at the start of 2007.
But expansion projects and new refineries will push production above one million bpd in 2012.
In a report last week, the London-based Centre for Global Energy Studies said the UAE had the lowest subsidies on petrol and diesel among oil producers. It put the subsidies at $10 per barrel of petrol and nothing on diesel as it considered Adnoc’s low prices as a policy of stable prices rather than subsidies, according to CGES sources.