With oil prices closing in on $100/barrel there are suggestions that New Zealand could be the place that petroleum companies next explore. The reason for the increase in demand is the shift away from the developed countries in the west to the emerging markets in the east. This year demand has exceeded supply by 90,000 barrels a day on average since early April. In fact China has started to run out of diesel over the last couple of months – it has also been responsible for 40% of world growth in diesel over the last 2 years.
With demand continuing to grow forcing prices up OPEC may be forced to raise production or quotas. In 2008 prices of $137 a barrel were very damaging to the world economy and allowing these levels of prices will have a serious effect on a recovery.