# Presentation: 739826

## International Energy Outlook 

**April 19, 2004**

***International Energy Outlook ***
***2004***

- Guy Caruso
- Administrator
- Energy Information Administration
- Thirty-First Annual International Energy Conference
- Boulder, Colorado

**Notes:**
I am pleased to present the release of the Energy Information Administration’s International Energy Outlook 2004, the Department of Energy’s annual assessment of world energy markets with projections to 2025.
Today, the Energy Information Administration (EIA) is releasing its mid-term projections of international energy use and carbon dioxide emissions in the International Energy Outlook 2004 (IEO2004). The IEO2004 is EIA’s annual assessment of world energy markets with projections of regional energy consumption, energy consumption by primary fuel, electricity  consumption, carbon emissions, nuclear generating capacity, and international coal trade flows.  World oil production and natural gas production forecasts are also included in the report.
The report is an extension of EIA’s Annual Energy Outlook 2004 (AEO2004—published January 2004).  The U.S. projections that appear in the IEO are consistent with those published in the AEO2004.
The projections in the IEO2004 are not statements of what will happen, but what might happen given the specific assumptions and methodologies used.  These projections provide an objective, policy-neutral reference case that can be used to analyze international energy markets. Models are abstractions of energy production and consumption activities, regulatory activities, and producer and consumer behavior.  The forecasts are highly dependent on the data, methodologies, model structures, and specific assumptions used in their development.  Trends depicted in the analysis are indicative of tendencies in the real world rather than representations of specific real-world outcomes.

## International Energy Outlook 2004 indicates that over the next 24 years ...

- Energy use will grow strongly, especially among the developing countries (2.7% per year in the developing world)
- There will be continued reliance on fossil fuels through 2025; oil remains the dominant fuel type (39 % of total world energy use)
- Natural gas is the fastest growing source of primary energy (2.2% per year)
- Coal will continue to be the predominant source for electricity generation, but natural gas will be an important supply source for power generation in many parts of the world, given its efficiency and environmental benefits.
- Carbon dioxide emissions resulting from the combustion of fossil fuels will continue to grow (1.9% per year)

## World Gross Domestic Product in Three Economic Growth Cases, 1970-2025

**Notes:**
GDP is a key driver for increases in future world energy consumption. It is also a major source of uncertainty in our forecast.  In the IEO2004 forecast, we offer three possible paths for economic growth.  In the reference case world GDP grows by 3.0 percent per year; in the high growth case by 3.6 percent per year; and in the low growth case by 2.3 percent per year.

Economic growth is an important driver for the rise in future world energy demand. The industrialized world currently accounts for 78 percent of the world’s wealth; the developing world 19; with the remainder held by the transitional economies of the EE/FSU. Over the projection period, the gap among the regions of the world is expected to narrow, as growth in the emerging economies of the world exceeds that of the more industrially-mature economies.  By 2025, the developing world’s share of world gross domestic product is expected to increase to nearly 30 percent of the world’s total; the industrialized world’s share is expected to fall to 68 percent. Overall global economic growth in the reference case is 3.0 percent per year over the projection period.

## World Marketed Energy Consumption in Three Economic Growth Cases, 1970-2025

- 710

- 623

- 542

**Notes:**
Under the assumptions of the reference case, world energy consumption grows by 1.8 percent per year, reaching 623 quadrillion Btu in 2025. The high and low economic growth cases form a substantial range of 168 quadrillion Btu. 

Changes in the assumptions about economic growth and intensities lead to substantial differences in the projections for 2025. The IEO2004 reference case shows total world energy consumption reaching 623 quadrillion Btu in 2025. In the high economic growth case, total world energy use in 2025 is projected to be 710 quadrillion Btu, 87 quadrillion Btu (or about 44 million barrels per day oil equivalent) higher than in the reference case.  Under the assumptions of the low economic growth case, worldwide energy consumption in 2025 is expected to be 81 quadrillion Btu (40 million barrels per day oil equivalent) lower than the reference case, at 542 quadrillion Btu. Thus, there is a substantial range of 168 quadrillion Btu, or about one-fourth of the total consumption projected for 2025 in the reference case, between the projections in the high and low economic growth cases.

## Forecast Comparisons in 2025:  IEO2004 vs. IEO2003

- Forecast Comparisons in 2025:  *IEO2004 *vs*. IEO2003*

**Notes:**
The projection for total world energy consumption is about 3 percent lower in the IEO2004 than in the IEO2003. 
The largest change from last year’s report is the lowered forecast for natural gas, which is 14 percent below IEO2003 projections in 2025. 
Consumption of oil is about 2 percent higher than in last year’s forecast; nuclear about 7 percent higher; renewables and coal are largely unchanged, both at less than 1 percent higher.
The lower natural gas forecast this year is the result of concerns about the long-term ability of natural gas producers to bring sufficient resources to market at prices competitive with those of other fuels, slightly lower assumptions for worldwide economic growth, and a slower projected decline in nuclear power generation (which competes with natural gas in the power sector). 
The largest downward revisions to gas use in this year’s outlook occur in the regions of Central and South America (-27 percent relative to IEO2003), developing Asia (-20 percent), and in the EE/FSU (-16 percent).

## World Marketed Energy Consumption by Region, 1970-2025

- World Marketed Energy Consumption by Region, 1970-2025

**Notes:**
The developing world accounts for most of the growth in world energy use and in 2025 accounts for 43% of the world’s energy consumption, compared to 45% in the industrialized world. In 2001, the developing world accounted for 34% of world energy consumption. The industrialized world accounted for 52% and the remaining 13% was consumed by the economies of Eastern Europe and the former Soviet Union (EE/FSU).
The IEO2004 mid-term outlook continues to show robust growth for energy among the developing nations of the world, particularly in developing Asia (including China and India), where demand for energy is expected to double over the 24-year projection period. Developing Asia alone accounts for nearly 70 percent of the growth in energy use in the developing world. The gap between consumption in the developing world and the industrialized world is expected to narrow considerably over the projection period. 
In contrast to the developing world, slower growth in energy demand is projected for the industrialized world, averaging 1.2 percent per year over the forecast period, as compared to the developing world’s 2.7 percent per year growth. Generally, the nations of the industrialized world can be characterized as mature energy consumers with comparatively slow population growth.  Gains in energy efficiency and movement away from energy-intensive manufacturing to service industries result in the lower growth in energy consumption.  
In the EE/FSU energy demand is projected to grow by 1.5 percent per year in the IEO2004 reference case.  Slow or declining population in this region, combined with strong projected gains in energy efficiency as old, inefficient equipment is replaced, leads to the projection of more modest growth in energy use than in the developing world.  

## Energy Intensity by Region, 1970-2025

- Source:  EIA, *International Energy Outlook 2004*

**Notes:**
Energy intensity—the relationship between energy and GDP—is expected to improve/decrease by 1.1 percent per year.  The fastest improvement (or decline) in energy intensity is projected for the EE/FSU. The rapid projected improvement in the EE/FSU is not enough to erase the large gap between this region and the rest of the world with respect to energy intensity and, in 2025, EE/FSU energy intensity is still twice as high as in the developing world and five times as high as in the industrialized world.
Another way to quantify the uncertainty surrounding a long-term forecast is to consider the relationship between energy and gross domestic product (GDP) over time.  Economic growth and energy demand are linked, but the strength of that link varies among regions and stages of economic development. 
In the IEO2004 forecast, energy intensity in the industrialized countries is expected to improve (decrease) by 1.2 percent per year, slightly slower than the 1.4 percent per year improvement observed in the region between 1970 and 2001. Energy intensity improves more quickly among the developing countries—by 1.8 percent per year—as their economies begin to behave more like those of the industrialized countries as a result of improving standards of living that accompany the projected economic expansion. 
For more than three decades, the EE/FSU has maintained a much higher level of energy intensity than either the industrialized or developing countries. Over the forecast horizon, energy intensity is expected to improve in the EE/FSU region—by 2.5 percent per year— in concert with expected recovery from the economic and social declines of the early 1990s.

## World Primary Energy Consumption by Fuel Type, 1970-2025

- Share of
- World
- Total

|  |  |
| --- | --- |

**Notes:**
Oil continues to be the dominant energy source.  Oil’s share of world energy remains unchanged at 39% over the forecast period.  Natural gas grows most rapidly over the projection period, capturing 25% of the world’s energy use by 2025, up from 23% in 2001. 
In the industrialized world, increases in oil use are projected primarily in the transportation sector, where there are currently no available fuels to compete significantly with oil. In the developing world, demand for oil increases for all end uses, as countries replace non-marketed fuels used for home heating and cooking, with diesel generators and for industrial petroleum feedstocks.
Natural gas is projected to maintain average annual growth of 2.2 percent over the forecast period, capturing 25 percent of the world’s energy use by 2025. Gas is seen as a desirable option for electricity, given its efficiency relative to other energy sources and the fact that it burns more cleanly than either coal or oil, making it a more attractive choice for countries intent upon reducing greenhouse gas emissions.
Coal remains an important fuel in the world’s electricity markets and is expected to continue to dominate fuel markets in developing Asia. Coal’s share of world energy consumption declines slightly in the IEO2004 reference case, from 24 percent in 2001 to 23 percent in 2025.  Coal use is projected to increase in all regions of the world except for Western Europe and the EE/FSU (excluding Russia), where coal is projected to be displaced by natural gas and, in the case of France, nuclear power for electric power generation.
The highest growth in nuclear generation is expected for the developing world, where consumption of electricity from nuclear power is projected to increase by 4.1 percent per year between 2001 and 2025.  Developing Asia, in particular, is expected to see the largest increment in installed nuclear generating capacity over the forecast, accounting for 95 percent of the total increase in nuclear power capacity for the developing world as a whole. In the industrialized world and the EE/FSU, extensions of operating licenses (or the equivalent) slow the decline in nuclear generation. 
Consumption of electricity from hydropower and other renewable energy sources is expected to grow by 1.9 percent per year over the projection period. Much of the growth in renewable energy use is expected to result from large-scale hydroelectric power projects in the developing world, particularly among the nations of developing Asia. China, India, Malaysia, and Vietnam are already constructing or have plans to construct ambitious hydroelectric projects in the coming decades.

## World Oil Consumption and Production, 2001, 2010, and 2025

**Notes:**
Oil consumption is projected to rise by 1.9 percent per year over the 24-year forecast period, from 77 million barrels per day (b/d) in 2001 to 121 million b/d in 2025.
The United States, China, and the other nations of developing Asia account for nearly 60 percent of the increase in oil in the 2001-2025 period.
The increases in worldwide oil use projected in the reference case would require an increment of 44 million b/d over current productive capacity.  OPEC producers are expected to raise capacity by 29 million b/d and be the major suppliers of increased production requirements, but non-OPEC production is expected to remain competitive and rise by 18 million b/d, with major increments of supply coming from offshore resources, in the Caspian Basin, Latin America, and deepwater West Africa.
Although the nations of the industrialized world continue to consume more of the world’s oil than do those of the developing world, the gap is projected to narrow considerably over the forecast period.  In 2001, developing nations consumed about 64 percent of the oil consumed in the industrialized world, but by 2025 they are expected to consume 94 percent as much oil as the industrialized world. Developing Asian oil consumption is expected to grow from 14.8 million barrels per day in 2001 to 31.6 million barrels per day in 2025, an increase of 16.9 million barrels per day and representing 39 percent of the total world increment in oil use over the projection period.                                                                                                                                                                             

## Persian Gulf Oil Productive Capacity by Country, 2001 and 2025

**Notes:**
In the IEO2004 reference case projection, Persian Gulf oil production capacity is expected to increase from 32.6 million barrels per day in 2001 to 61.5 million barrels per day in 2025.
The largest increments in oil productive capacity among the Persian Gulf producers is projected to occur in Saudi Arabia, where productive capacity grows by 12.3 million barrels per day over the forecast period.
Substantial increases in production capacity are also expected in other Persian Gulf countries, notably Iraq (3.8 million barrels per day), United Arab Emirates (2.5 million barrels per day), and Kuwait (2.6 million barrels per day).
Among the other OPEC countries, oil production capacity increases by 6.3 million barrels per day, from 10.2 million barrels per day to 16.5 million barrels per day.  Non-OPEC suppliers are expected to increase productive capacity by 17.9 million barrels per day between 2001 and 2025.

## World Oil Reserves by Country, as of January 1, 2004

- Source:  "Worldwide Look at Reserves and Production."*Oil & Gas Journal*,
- Vol. 100, No. 49 (December 22, 2003), pp. 46-47.

**Notes:**
Oil resources are adequate to meet growing oil demand to 2025. 
OPEC accounts for 69 percent of the world’s proved oil reserves, and six of the seven countries with the largest proved reserves are OPEC members and alone account for 61 percent of the world’s oil reserves.

According to Oil & Gas Journal, in January 2004, OPEC accounted for 870 billion barrels of the 1,266 billion barrels of the world’s proven oil reserves. 
The largest change in oil reserves between 2003 and 2004 occurred for Iran, based upon new information from the country’s energy ministry. Iran’s proved oil reserves had not been revised since 1999 and the 2004 revision represents a 36 billion barrel increment in reserves for Iran, which now stand at 126 billion barrels. Among the OPEC member countries, Algeria, Iraq, Kuwait, Nigeria, and Saudi Arabia also witnessed more modest increments in proved reserves between 2003 and 2004.  
Outside of OPEC, Mexico observed a 3 billion barrel increment in proved oil reserves in 2004; Canada a 1 billion barrel decrement, with about half attributed to declines in crude and condensate reserves (according to the Canadian Association of Petroleum Producers) and half from its oil sands reserve estimates (according to the Alberta Energy and Utilities Board). 

## World Oil Prices in Three Cases, 1970-2025

- Source:  EIA, *International Energy Outlook 2004*

**Notes:**
Oil prices are expected to reach $27 per barrel in 2002 dollars (in nominal dollars $51 per barrel). 
In the low price case, prices are projected to be $17 per barrel in 2005, where they remain through 2025.  In the high price case, prices are projected to reach $34 per barrel in 2013 and to be around $35 per barrel by 2025.

Reference case prices are substantially the same as in last year’s forecast. The projected leveling off in the high price case is due to the market penetration of alternative oil supplies that could become economically viable at that price (such as liquids from oil sands, natural gas, coal, biofuels, and oil shale).  The reference case assumes that prices remain in the OPEC price ban.  The low price case assumes that all suppliers are competitive in the market place.
In all the IEO2004 oil price cases, oil demand is expected to rise significantly over the projection period.  In the high and low world oil price cases, the projected rise in oil consumption ranges from a low of 36 million barrels per day to a high of 56 million barrels per day, respectively.  There is widespread agreement that resources are not a key constraint on world demand to 2025.  Rather more important are the political, economic, and environmental circumstances that could shape developments in oil supply and demand.

## Nonconventional Oil Production in Three Price Cases, 2001-2025

**Notes:**
In the IEO2004, nonconventional oil production (including production from oil sands, ultra-heavy oils, gas-to-liquids technologies, coal-to-liquids technologies, biofuel technologies, and shale oil) increases by 3.8 million barrels per day by 2025, rising from 1.4 million barrels  per day in 2001 to 5.2 million barrels per day in 2025.
Nonconventional oil production penetrates more quickly in a high world oil price scenario, as sustained high world oil prices allow nonconventional sources to be economically competitive with conventional sources.  At sustained oil prices in the $30-$35 per barrel (constant 2002 dollars) range, as assumed in the IEO2004 high world oil price case, nonconventional oil production would be 54 percent higher in 2025 than projected in the reference case, reaching 8.0 million barrels per day.
Conversely, under the assumptions of the IEO2004 low world oil price case, nonconventional supplies cannot compete with conventional supplies at oil prices remaining in the $17 per barrel range. In this case, nonconventional oil production increases more slowly, reaching only 4.1 million barrels per day in 2025.

## Natural Gas Consumption by Region,IEO2004 vs. IEO2003

- Natural Gas Consumption by Region,*IEO2004* vs. *IEO2003*

**Notes:**
The natural gas consumption forecast is lower than in last year’s report.  The lower forecast this year is the result of concerns about the long-term ability of natural gas producers to bring sufficient resources to market at prices competitive with those of other fuels, slightly lower assumptions for worldwide economic growth, and a slower projected decline in nuclear power generation (which competes with natural gas in the power sector).
Natural gas is expected to remain an important supply source for new electric power generation in the future.  It is seen as the desired option for electric power, given its relative efficiency and environmental advantages in comparison with other fossil fuels. Natural gas burns more cleanly than either coal or oil, making it a more attractive choice for countries seeking to reduce greenhouse gas emissions.
The most robust growth in gas demand is expected among the nations of the developing world, where overall demand is expected to grow by 2.9 percent per year from 2001 to 2025 in the reference case. In the industrialized world, where natural gas markets are more mature, consumption of natural gas is expected to increase by an average of 1.8 percent per year over that same time period, with the largest increment projected for North America at 13 trillion cubic feet. 
Gas demand grows by 2.1 percent per year in the EE/FSU. The fastest rates of growth are projected for the countries of Eastern Europe, where economic recovery has largely been underway since the collapse of the Soviet Union, and the economies of the region continue to align themselves with their wealthier Western European neighbors.

## World Natural Gas Reserves by Region, as of January 1, 2004

*Vol. 100, No. 49, December 22, 2003, pp. 46-47*

**Notes:**
Natural gas reserves are abundant, but concentrated in the FSU and the Middle East, which accounts for almost 75 percent of the world’s gas reserves.
Worldwide proved natural gas reserves increased for the ninth consecutive year in 2004, to 6,076 trillion cubic feet. 
Since the mid-1970s, world natural gas reserves have generally trended upward each year. As of January 1, 2004, proved world natural gas reserves, as reported by Oil & Gas Journal, were estimated at 575 trillion cubic feet more than the estimate for 2003. 
The developing world accounted for virtually all the increase in proved reserves.  Qatar, where the estimate of proved gas reserves grew from 508 trillion cubic feet for 2003 to 910 trillion cubic feet for 2004, accounted for most of the increment. Smaller but still substantial increases in estimated gas reserves were reported for Iran (an increase of 128 trillion cubic feet) and Nigeria (35 trillion cubic feet).
Russia, Iran, and Qatar combined account for about 58 percent of the world’s natural gas reserves. Reserves in the rest of the world are fairly evenly distributed on a regional basis. 
Despite high rates of increase in natural gas consumption, particularly over the past decade, most regional reserves‐to‐production ratios have remained high. Worldwide, the reserves‐to‐production ratio is estimated at 61 years. 
Of the total natural resource base of over 15,000 trillion cubic feet, an estimated 3,000 trillion cubic feet is in “stranded” reserves, usually located too far away from pipeline infrastructure or population centers to make transportation of the natural gas economical. 

## World Coal Consumption by Region, 1980, 2001, and 2025

- World Coal Consumption by Region, 1980, 2001, and 2025

**Notes:**
Coal use is expected to grow slowly, averaging 1.5 percent per year between 2001 and 2025. 
Coal is only expected to decline in Western Europe, Eastern Europe, and the FSU (excluding Russia). Coal continues to dominate energy markets, particularly in developing Asia.
China and India account for 67 percent of the total expected increase in coal use worldwide (on a Btu basis).
The projected slow growth in world coal use suggests that coal will account for a shrinking share of global primary energy consumption. In 2001, coal provided 24 percent of world primary energy consumption, down from 26 percent in 1990.  In the IEO2004 reference case, the coal share of total energy use is projected to fall to 23 percent by 2025.  
Currently, of the coal consumed worldwide, 64 percent is used for electricity generation; and in almost every region, power generation accounts for most of the projected growth in coal consumption.  Significant amounts of coal are also used for steel production. Where coal is used in the industrial, residential, and commercial sectors, other energy sources—primarily, natural gas—are expected to gain market share.  One exception is China. With China’s abundant coal reserves and limited access to other sources of energy, coal continues to be the most widely used fuel in the country’s rapidly growing industrial sector. 

## World Recoverable Coal Reserves as of January 1, 2001

**Notes:**
At current levels of consumption, total worldwide recoverable reserves of coal would last for over 200 years.
Coal deposits are widely distributed, but 60 percent of the world’s recoverable reserves are located in the United States, former Soviet Union, and China.
Total recoverable reserves of coal around the world are estimated at 1,083 billion short tons—enough to last approximately 210 years at current consumption levels.  Sixty percent of the world’s recoverable reserves are located in three parts of the world: the United States (25 percent), FSU (23 percent), and China (12 percent). Another four countries—Australia, India, Germany, and South Africa—account for an additional 29 percent. In 2001, these six countries and the former Soviet Union accounted for 80 percent of total world coal production.

## World Net Electricity Consumption by Region, 2001-2025

**Notes:**
World net electricity consumption nearly doubles over the projection period.
The strongest growth in electricity use is projected for the developing countries of the world, where electricity demand increases by an average of 3.5 percent per year, compared to 2.3 percent per year worldwide.
World net electricity consumption rises from 13,290 billion kilowatthours in 2001 to 23,072 billion kilowtthours in 2025.
Robust economic growth in many of the developing nations is expected to boost demand for electricity to run newly purchased home appliances for air conditioning, cooking, space and water heating, and refrigeration.
For the industrialized world and the transitional economies of the EE/FSU, where electricity markets are more mature, slower average growth rates of 1.6 percent per year and 2.0 percent per year, respectively, are projected.

## Shares of Energy Use for Electricity Generation, 2001-2025

- Source:  EIA, *International Energy Outlook 2004*

**Notes:**
Coal continues to retain the largest market share of world electricity generation throughout the 2001-2025 forecast period, however, its importance will be moderated somewhat by a projected rise in natural gas use for generation.
Coal’s share of world electricity generation falls from 38 percent in 2001 to 37 percent in 2025; at the same time, the natural gas share increases from 18 percent to 25 percent. 
The role of nuclear power in the world’s electricity markets is projected to lessen as reactors in the industrialized nations reach the ends of their operating lives.  New reactors are generally to be built in the developing world, especially developing Asia. The nuclear power share of energy use for electricity generation falls from 16 percent in 2001 to 12 percent in 2025.
Generation from hydropower and other marketed renewable energy sources (geothermal, wind, biomass, and solar) is projected to grow by 57 percent over the 2001-2025 forecast period, but their share of total electricity generation is projected to remain the current level of 20 percent. In the developing world, primarily developing Asia, much of the growth in renewables is expected to occur from large-scale hydro.  In the industrialized world, non-hydro renewable sources (such as wind in Western Europe and in the United States) grow fastest.

## Installed Nuclear Capacity, IEO2004 vs. IEO2003 

- Installed Nuclear Capacity, *IEO2004 *vs. *IEO2003*

**Notes:**
The world nuclear power is higher in this year’s outlook than in last year’s.  The prospects for nuclear power have been reassessed in light of higher capacity utilization rates reported for many existing nuclear facilities and the expectation that fewer retirements of existing plants will occur than previously projected.
In the IEO2004 reference case, world installed nuclear capacity rises from 353 gigawatts in 2001 to 407 gigawatts in 2015 before declining to 385 gigawatts in 2025.
Extensions of operating licenses (or the equivalent) for nuclear power plants are expected to be granted among the countries of the industrialized world, slowing the decline in nuclear generation. In the United States, natural gas prices are projected to be higher than in previous forecasts, and as a result no U.S. nuclear power units are expected to be retired in the IEO2004 reference case.

## World Energy-Related Carbon Dioxide Emissions by Region, 1990-2025

- World Energy-Related Carbon Dioxide Emissions by Region, 1990-2025

**Notes:**
World carbon dioxide emissions rise from 23.9 billion metric tons in 2001 to 37.1 billion metric tons in 2025 in the IEO2004 reference case projections.
The developing world is expected to account for much of the increase in carbon dioxide emissions over the projection period (46 percent of the world’s carbon dioxide emissions in 2025).  
The IEO2004 reference case projections indicate that carbon dioxide emissions from developing countries will surpass those of the industrialized world around 2020.
In 2001, carbon dioxide emissions from the industrialized countries accounted for 49 percent of the global total, followed by the developing countries at 38 percent and the EE/FSU at 13 percent.  
Much of the increase in emissions is expected in the developing countries, where emerging economies are expected to produce the largest increases in energy consumption, and carbon dioxide emissions are projected to grow by an average of 2.7 percent per year between 2001 and 2025.  Developing countries alone account for 60 percent of the projected increment in world carbon emissions between 2001 and 2010 and 61 percent between 2001 and 2025.  Continued heavy reliance on coal and other fossil fuels projected for the developing countries is expected to drive the growth in carbon dioxide emissions over the forecast period. 

## World Energy-Related Carbon Dioxide Emissions by Fossil Fuel Type, 1970-2025

**Notes:**
Oil accounts for the largest increment in worldwide carbon dioxide emissions in the IEO2004 reference case, followed by coal and natural gas.
In 2025, emissions related to oil use are projected to be 5.7 billion metric tons higher than the 2001 level.
Emissions from coal use are expected to be 4.1 billion metric tons above 2001 levels in 2025 and emissions from natural gas 3.4 billion metric tons above 2001 levels. Although natural gas use is expected to increase at a faster rate than oil use, it is a less carbon-intensive fuel.

## Carbon Dioxide Intensity for Selected Countries and Regions, 2001 and 2025

**Notes:**
World carbon dioxide intensity - the amount of carbon dioxide produced per dollar of GDP - is expected to continue to improve over the projection period, from 739 billion metric tons in 1997 dollars of GDP in 2001 to 566 metric tons per million 1997 dollars in 2025.
The steepest rates of improvement are projected for the EE/FSU and for China. Continuing economic recovery in the FSU allows the replacement of inefficient capital stock with new equipment, allowing fast-paced improvement in carbon dioxide intensity of 2.7 percent per year between 2001 and 2025; Eastern Europe 2.9 percent per year.
In China, carbon dioxide intensity improves by 2.6 percent per year.  The country is projected to remain heavily reliant on fossil fuels, especially coal, in the IEO2004 reference case, but even stronger growth in annual GDP allows carbon intensity to improve quickly.
World carbon intensity has improved (decreased) substantially over the past three decades, falling from 1,100 metric tons carbon dioxide per million 1997 dollars of GDP in 1970 to 739 metric tons per million 1997 dollars in 2001. 
Eastern European nations began their economic recovery much earlier than the nations of the FSU.  As a result of strong investment in improving the efficiency of energy use among Eastern European countries and a push to increase the use of natural gas, carbon dioxide intensity fell by nearly 40 percent between 1990 and 2001, as compared with only 5 percent in Russia and 9 percent in the other FSU nations. Improvement in carbon dioxide intensity in Eastern Europe is projected to continue over the projection period, at an average rate of 2.9 percent per year.
China’s annual GDP growth is projected to average 6.1 percent, compared with an expected 3.4-percent annual rate of increase in fossil fuel use over the projection period.  China’s carbon dioxide intensity is expected to decrease by 2.6 percent per year on average between 2001 and 2025.

## International Energy Outlook 2004 indicates that over the next 24 years ...

- Energy use will grow fastest in the developing world
- Oil remains the dominant fuel type
- Natural gas will be the fastest-growing primary energy source
- Resources will be sufficient to meet demand through 2025
- Carbon dioxide emissions will continue to grow
- Electricity will increase rapidly in the developing world
- Coal will remain the predominant fuel for electric power generation, but gas’ importance will grow
- Developing Asia will expand its use of nuclear power