Financial crises and the outlook for the world energy economy

With respect to world energy, two subjects are preoccupying energy economists. They are (1) how will production of oil and gas hold up with the lowest oil prices since 1945 and (2) are the recessions in Asia, parts of Latin America and the CIS rendering futile any attempts to balance the energy markets? The fundamental question asked is: What kind of market are we in? The paper is structured to provide answers or discuss the following sub-questions. (i) does the energy market operate by the same rules as the global economy; (ii) what lessons can be learned from disconnection of the oil market problems of 1973 and the collapse of the tanker market and (iii) how should the markets be regulated. A detailed analysis of world energy growth in the second half of this century and how it may develop in the next 20 years is given. Special attention is paid to the role of the Asia/Pacific market, the strength of the world economic system, the impact of privatisation in Russia and possible turbulence in share markets. (UK)