WASHINGTON, D.C. (July 22, 2010) – Both China and India are likely to continue increasing their oil usage by hundreds of thousands of barrels a day in coming years as their economic growth drives up energy needs, East-West Center Senior Fellow Fereidun Fesharakisaid during a recent talk at the Center for Strategic and International Studies, where he also serves as a senior associate. But Fesharaki said he sees China’s growth in demand peaking around the year 2020.

 

Click hereto view a video of Fesharaki’s presentation.

 

Fesharaki forecasted China’s oil use to rise by around 400,000 barrels a day for each of the next eight to 10 years, after which he predicted it will slow down significantly. India’s annual growth will be 100,000 to 150,000 barrels a day, he said.

 

“In China and India it is very much the industry, the economy and the way the system is organized which is leading to growth,” said Fesharaki, who also is chairman of FACTS Global Energy, a consultancy firm with offices in Singapore, London and Hawaii.

 

But the world’s two most populous countries diverge when it comes to policy, Fesharaki said. While both have large multinational energy companies, China’s big oil and natural gas companies influence government policy, he said, while in India, the government drives oil company policy.

 

The arrangement is such that Chinese companies can influence government actions and have a free hand in certain matters such as some large acquisitions, Fesharaki said. An Indian company, however, would face obtaining government approval for a similar purchase.

 

Fesharaki added that Chinese policymakers do keep an eye on trying to keep use from rising too high, while India hasn’t gotten to the point of saying it wants to limit consumption. His projections show China’s domestic oil production remaining flat in coming years, so more imported oil would be needed to satisfy rising demand