Elgar original reference
Edited by Hugh Dyer and Maria Julia Trombetta
Chapter 11: Energy demand: security for suppliers?
The vast majority of papers on energy security look at it from the consumer’s point of view, making security of supply the key preoccupation. However, this volume is an excellent illustration that energy security is an ‘umbrella term’, covering ‘many concerns linking energy, economic growth and political power’ (Westminster Energy Forum 2006, p. 9). Preoccupations of suppliers are not new; they emerged in the 1980s and have grown in scope ever since. These interests and concerns are expressed by both individual producing countries and by organizations that bring them together. Demand security is frequently portrayed as the other side of the energy security medal, the side which was overlooked for a long time. Most decision-makers and analysts currently agree about the interconnectedness of supply security and demand security. A vicious circle emerges, for example, when high prices lead to the decline in demand and, therefore, limit the will of producing countries to invest in new production facilities and in infrastructure bottlenecks. ‘The disincentive to invest then creates the roots of the next oil price shock once oil demand recovers’ but the capacities to feed the demand remain limited (Fattouh and van der Linde 2011, p. 12). Another vicious circle emerges when prices are too low, they constrain opportunities for bringing into operation new oil and gas fields or ways of their transportation.
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