Sticker shock at the pump will likely persist for consumers during the next year as high oil prices continue to affect the cost of gasoline.
Mark Finley, general manager of global energy markets and U.S. Economics for BP America, said crude oil — one of the most significant factors influencing the increase in gasoline costs — has risen for the sixth consecutive year.
“It’s the first time in history that oil prices have gone up for six years in a row,” Finley said about crude oil prices tracked by the company since 1861. “It’s looking, so far, like that is going to continue in 2008.”
The average price for a barrel of crude oil in 2007 was $72.39, rising from just over $50 to above $96 at year-end. On June 30 of this year, it hit $143.67 a barrel.
Finley, who drew from the findings in BP’s 57th annual statistical review, discounts any correlation between the rise in price and lack of reserves, citing the company assessments show an increase in proved reserves. Enough, in fact, to meet current production for 41 years. “Reserves are going up, not down over time,” he said, noting high demand in developing nations and a fast-growing world economy were factors in the increase.
The company’s review, published annually in June, offers data on energy production and consumption around the world. Finley, who oversees the review, presented its 2007 findings on the University of Houston campus June 25 to an audience of UH students, faculty and staff.
One of the world’s largest oil and gas companies, BP found overall energy consumption increased by 2.4 percent in 2007, the fifth consecutive year of above average growth. This included increases recorded at 27.8 percent for ethanol, 1.7 percent for hydroelectric generation, 3.1 percent for natural gas and 4.5 percent for coal. Coal has been the fastest growing major fuel for five consecutive years, Finley said.
While global oil demand grew 1.1 percent (1 million barrels a day) last year, Finley said, in the U.S. high prices have kept the demand down. The consumption rose in areas where oil is subsidized and places such as India and China.
For more information, visit BP’s Statistical Review of World Energy online.