The increasing gap between the demand and supply of gas, due to rising demand and limited supply, is posing serious challenges before the GCC petrochemical industry, as the gap is likely to further widen in the coming years.
While gas consumption in Iran, Middle East and the UAE exceeds production, Saudi Arabia satisfies its own demand by producing 99.23 billion cubic metres of gas annually. However, the demand-supply gap presently gets balanced to some extent as Egypt, Algeria, Oman and Qatar stand out to be net exporters of gas.
Meanwhile, the distressing fiscal crisis impeding recovery of the EU and the US economies is adding to the adversities.
Speaking at the 7th annual Gulf Petrochemicals and Chemicals Association (GPCA) Forum, UAE Minister of Environment and Water, Dr. Rashid Ahmed Bin Fahad said financial crisis in the US coupled with political impasse over looming fiscal crisis, and financial slump and debt crises in the EU are retarding global recovery. Besides, the swiftly rising eastern economies are also losing pace.
These situations have raised concerns about worsening of the financial crisis, and are feared to hit the regional as well as global petrochemical producers, and even negatively impact their earnings.
Dr. Fahad noted that though GCC region enjoys a more stable economy, global financial slump is a matter of major concern, as it has raised doubts over future development and its effect on the region’s strategic hydrocarbon industries. This is more so as interconnected factors like the population growth, economy and government policies have been responsible for the growth in oil and petrochemical demand, since historic times.