China will become the world’s biggest carbon polluter this year, overtaking the United States, the International Energy Agency (IEA) said in a bleak forecast of soaring global demand for fossil fuels. The rapid growth of the Chinese and Indian economies will raise global energy demand by 50 per cent by 2030, the agency said in its annual World Energy Outlook. India and China alone will account for almost half of the increase.

The agency pointed a finger at soaring coal demand, which threatens to upset carbon reduction targets, as it painted an alarming picture of a future of energy insecurity, soaring oil prices and a massive increase in carbon emissions. The dash towards prosperity in Asia will be fuelled by hydrocarbons - and mainly by increased burning of coal – with an inexorable rise in carbon emissions, hastening climate change.

Accelerating demand for oil, which will reach 116 million barrels per day (bpd) by 2030, up 32 per cent, will require huge investments to keep pace, the IEA said, and the sums are increasing. Inflation has taken its toll, and the agency reckons that $5.4 trillion (£2.6 trillion) must be spent to raise capacity, up a quarter from the estimate last year. It gives warning that plans to raise output from new projects may not compensate for the decline in existing fields.

“A supply-side crunch in the period to 2014, involving an abrupt escalation in oil prices, cannot be ruled out,” the IEA said in its report. ...    more »