5.8 pc growth of primary energy supply required: Deora

Petroleum and Natural Gas Minister Murli Deora on Monday stressed the need for maintaining a 5.8 per cent annual growth rate of primary energy supply to sustain about nine per cent economic growth for the next 25 years, to eradicate poverty and meet human development goals.

"India needs to sustain economic growth of at least nine per cent over the next 25 years if it is to eradicate poverty and meet its larger human development goals. The primary energy supply must increase at the rate of 5.8 per cent annually for fuelling the growth," Deora said while addressing a session at Petrotech-2009.

The minister said, "The more we can do to understand and remove the factors which constrain the global energy supply system and lead to increased market volatility, the better positioned we well be to meet the future energy requirements of a dynamic and growing global economy.

"We all have stake in ensuring the availability of energy at a reasonable price for future generations." Concerned at the volatility in crude oil prices in the international market, he pointed out, "Experience has taught us that very low prices and very high prices are not sustainable.

During periods of low oil prices, capital tends to move out of energy to sectors offering higher returns. Low-priced energy encourages greater consumption. By reducing investment and increasing demand, periods of low prices have set the stage for an inevitable corrective rise in prices."

"Investors in the petroleum industry, are no different, they need stability and predictability. Global efforts are, therefore required to address the ongoing price volatility that continues to impact oil markets and often delays investment decision. This can be achieved only through cooperation between oil producing nations," he suggested.

Echoing similar views, Minister of Oil and Gas, Sultanate of Oman Mohammed Bin Hamad Al Rumhy, said, "The consumers of energy want security of supply, whereas its producers want security of demand. I think price would hover around $45 per barrel in January and February this year and would be stabilised in three months."

While OPEC resorted to production cut for maintaining crude oil prices, oil rich nation Canada is augmenting production of black gold.

"We are not planning any production cut rather we are increasing our production. Presently, our production is around 1.3 million barrels per day, which would be ramped up to 2.5-3 million barrels per day by 2015," Minister of International and Intergovernmental Relations Ron Stevens said.