Changing Trends in the Production and Consumption of Oil and Natural Gas in the World

Abstract

Global energy consumption is rapidly increasing due to growing population and economic activity, and currently fossil fuels account for 87 % of this demand. Fossil fuels have always been at the center of governments' agenda around the globe, not only at present but also from the beginning of the industrialization period. The escalating need for energy in industry together with the mechanization of labor has led to a significant increase in the demand for fossil fuels. Advancement in coal-powered steam engines in the mid-1800s and the emerging electricity market in the late 1800s paved the way for a significant increase in coal consumption. Technological, economical, environmental, and political developments related to production of oil and natural gas, as well as new energy systems, have decreased the role of coal in the global energy mix. This study puts forth the argument that the main impetus for the expansion of the production of oil and natural gas began with World War I in 1914. Oil and gas started to reduce the importance of coal because of their higher energy density, especially after World War II. This process continued with the increase in car ownership and the development of mass transportation in the Cold War era. Moreover, major events in history, such as energy crises, wars, economic crises, natural disasters, political issues, and technological advancement, influenced oil production as well as consumption trends. Different eras brought different tendencies, related to the major geopolitical shifts. Therefore, the main aim of this chapter is to analyze the impact of these issues on the changing trends from a historical perspective, with the aim of producing a comprehensive overview.