Table of contents
World Economic and Shipping Trends
(by Arnfinn Jørgensen-Dahl)
Introduction
The Arctic economic landscape is part of the world economic landscape, and the search for and exploitation of natural resources in the Arctic have in the past been and will continue to be influenced by similar activities elsewhere in the world. Developments in the global economy over the last two-three years have made this abundantly clear very important among which are changes in world market conditions brought about by the global financial crisis.
But the world economic landscape is undergoing more fundamental change. For centuries the Mediterranean area was the centre of European economic, commercial, and trading activities. In the Far East, the Chinese Empire and other commercial and trading centres, ruled by feudal lords of varied magnificence and power, took part as best they could. But neither the East nor the West was islands unto themselves, and trade between the two was continuous and mutually advantageous. As late as around the year 1700 China and India together accounted for almost half the world’s Gross Domestic Product (GDP), each with just under a quarter of the total. Two centuries later the world economy was completely dominated by countries around the North Atlantic.
Spearheaded by the Spanish, the main causes of this drastic change were the onset of European imperialism, aided by superior military technology, and the industrial revolution. It made the north Atlantic area - Western Europe and eventually North America - the centre of gravity of the world economic system. It has remained so for the best part of three centuries.
But the centre of gravity of the world economy is again on the move and the North Atlantic area is now under serious challenge as the undisputed centre of world economic power and influence. Led by countries such as China, India, and Brazil regions outside the North Atlantic Area have accumulated an increasingly larger share of the world Gross Domestic Product (GDP). In the years 1995-2004 the North Atlantic area (US, Canada, and Western Europe) accounted for 60 to 64% of global economic output. In 2009 the share is expected to drop to 49%, and it will continue to decline, predicted to fall to 45% by 2012.
Table 3.1: Share of World Domestic Product
Rest of the World |
North Atlantic Area |
1995-2004 |
1995-2004 |
40-36% |
60-64% |
|
|
2009 |
2009 |
51% |
49% |
Source: Mark Deen Bloomberg, The Financial Express, “The Wests’share of global GDP set to fall”, June 03.2009. www.financialexpress.com/printer
Behind much of this massive 15% shift away from the North Atlantic area in a mere 15 years are the two most populous states of the world – China and India. Table 3.2 shows that both countries grew at impressive rates during the 1990s. Following the economic reforms introduced in the 1980’s under Deng Chiao Ping, China in particular surged ahead and with her in the lead both countries continued to grow strongly in the first decade of this century.
The year 2008 was a highly unusual one for the world economy and trade. Growth in the world GDP slowed dramatically during 2008 as the effects of the financial crisis that began in the US in 2007 were felt everywhere. The global economy began a serious downward slide in the second half of 2008. As a group the advanced or developed economies achieved only a growth of 0.5% in 2008 and shrank by 3.2% in 2009. For the first time since the 1930s the global economy showed negative growth.
Table 3.2: China and India Share of World GDP and Growth of GDP
Share of Global GDP 1990 |
Share of Global GDP 2003 |
GDP Growth Rate 1980-1990 |
GDP Growth Rate 1990-2003 |
|
China |
1.6% |
3.89% |
10.3% |
9.6% |
India |
1.5% |
1.64% |
5.7% |
5.9% |
Source: T.N. Srinivasan, “China, India and the World Economy”, Table 2, p 4.
Table 3.3 tells the story of real and projected world economic growth for the years 2008- 2011 (annual percentage change).
Table 3.3: Projected Rates of Economic growth
Region/Country |
2008 |
2009 |
2010 |
2011 |
WORLD |
3.0 |
-0.8 |
3.9 |
4.3 |
Advanced economies |
0.5 |
-3.2 |
2.1 |
2.4 |
of which |
||||
United States |
0.4 |
-2.5 |
2.7 |
2.4 |
Euro area |
0.6 |
-3-9 |
1.0 |
1.6 |
Germany |
1.2 |
-4.8 |
1.0 |
1.9 |
France |
0.3 |
-2.3 |
1.4 |
1.7 |
Italy |
-1.0 |
-4.8 |
1.0 |
1.3 |
United Kingdom |
0.5 |
-4.8 |
1.3 |
2.7 |
Japan |
-1.2 |
-5.3 |
1.7 |
2.2 |
Developing countries |
6.1 |
2.1 |
6.0 |
6.3 |
of which |
||||
Brazil |
5.1 |
-0,4 |
4.7 |
3.7 |
China |
9.6 |
8.7 |
10.0 |
9.7 |
India |
7.3 |
5.6 |
7.7 |
7.8 |
Transition economies |
||||
of which |
||||
Russia |
5.6 |
-9.0 |
3.6 |
3.4 |
Source: International Monetary Fund. World Economic Outlook Update , January 26, 2010. The numbers for 2010 and 2011 are projections. www.imf.org
The items showing energy use and electric power consumption per capita in Table 3.4 suggest that rapidly growing economies such as China, India, and Brazil will experience a hefty increase in demand for energy and other commodities in the years ahead if the economic development history of today’s advanced economies is anything to go by. Although individually the latter have followed somewhat different paths to reach their present state of economic affluence, they have all relied on more or less the same mixture of energy resources.
Economic development in the future will everywhere have to rely on a different mixture of energy sources. To develop economically in the future countries like China and India are burdened with the colossal task of achieving a better life for their huge populations by relying on a different, less climatically and environmentally damaging mixture of energy than today’s advanced economies have relied on, especially less reliance on coal. This may have a significant impact on patterns of investment and exploration for oil and gas in the Arctic.
Table 3.4: Energy Consumption in Important States
US |
Japan |
Russia |
China |
India |
Brazil |
Canada |
Norway |
|
Energy use (kg of o.e.per cap) |
7,924 |
4,135 |
4,586 |
1,319 |
492 |
1,164 |
8,469 |
7,151 |
Electric power consumption (kwh per cap) |
13,701 |
8,201 |
5,785 |
1,783 |
476 |
2,016 |
17,314 |
25,083 |
Source: The World Bank Group 2009. These figures are not strictly comparable because they refer in some cases to different years and should therefore be regarded as only indicative.
Shifting Patterns of Trade |
Economic activities and growth give rise to trade. From a shipping point of view the most important factors are the volume of merchandise trade that these activities give rise to, their destinations, and the product composition. Table 3.5 shows some trade data that illustrates the rapidly growing importance of China in particular. The table also gives an indication of the current international trade deficit of the US which in considerable measure is a result of trade with China.
Table 3.5: Share of World Exports and Imports
|
Exports 1948 |
Exports 1993 |
Exports 2003 |
Exports 2008 |
Imports 1948 |
Imports 1993 |
Imports 2003 |
Imports 2008 |
US |
21.7% |
12.6% |
9.8% |
8.2% |
13.0% |
NA |
16.9% |
13.5% |
China |
0.9% |
2.5% |
5.9% |
9.1% |
0.6% |
2,7% |
5.4% |
7.0% |
Source: The World Bank Group 2009
World trade in practically all types of merchandise products experienced rapid growth until 2008. Energy was at the centre of this surge in demand. The decline that occurred during 2008 and 2009 will be followed by renewed demand in the years ahead. As the fastest growing non-OECD economies, China and India will be the key energy consumers of the future. Since 1990 until 2006 China’s and India’s energy consumption together as a share of the world’s total energy consumption increased from 10 per cent to 19 per cent. Based on predictions of strong economic growth in the future, the two countries are expected to increase their combined energy consumption to 28% of world energy use in 2030. By contrast the US share of the total is expected to decrease form 21% in 2006 to 17% in 20301 .
The non-OECD world consists of more than China and India. In non-OECD Asia energy use is expected to rise by 104% between 2006 and 2030. Other non-OECD regions are also expected to be the source of a substantial increase in energy demand. The consumption of hydrocarbons is expected to increase at an annual rate of 0.9% from 2006 to 2030. It is also expected to remain the single largest source of energy, declining from 36% of world consumption of energy in 2006 to 32% in 2030. World coal consumption is expected to increase by 1.7% a year from 2006 to 2030 when it will account for 28% of total energy consumption. The US, China and India are together expected to account for 88% of the net increase in coal consumption between 2006 and 2030.
Natural gas and coal together account for the largest share of total world electricity generation. These two energy sources are expected to produce more than 60% of all electricity. In 2030 they will remain the most important sources of supply with a 64% share.
Trade by Destination |
Appendix 1 provides information about the export and import trade by destination of Canada, Russia, and the US, and important non-Arctic states such as Germany, Japan, China, and India.
These tables show, firstly, that the economically advanced countries trade mainly with each other, and secondly, that much of the trade of the developing economies is directed towards the advanced economies.
Table 3.6 shows the percentage growth in volume of merchandise trade by geographical region in the period 2006-2008. North American export growth slowed down to a mere 1.5% in 2008 and the European Union recorded no growth at all. Lacking demand for imported goods, especially consumer goods, led to a sharp drop in import volumes in the two regions. The exports and imports of the developing economies continued to drive world merchandise trade but at a reduced pace. China’s exports in 2008 were less than half her exports a year earlier.
Table 3.6: Exports and Imports of World, Important Regions and China
|
Exports |
|
Countries/Regions |
|
Imports |
|
2006 |
2007 |
2008 |
|
2006 |
2007 |
2008 |
8.5 |
6.0 |
2.0 |
WORLD |
8.0 |
6.0 |
2.0 |
8.5 |
5.0 |
1.5 |
North America |
6.0 |
2.0 |
2.5 |
7.5 |
3.5 |
0.0 |
European Union (27) |
7.0 |
3.5 |
1.0 |
13.5 |
11.5 |
4.5 |
Asia |
8.5 |
8.0 |
4.0 |
22.0 |
19.5 |
8.5 |
China |
16.5 |
13.5 |
4.0 |
Source: UNCTAD, Review of Maritime Transport 2009. Data from table on p.6
As mentioned earlier, China and India increased their share of world total energy consumption from 10% to 19% between 1990 and 2006. In 2030 they are expected to account for 28%. In 2008 primary energy consumption slowed, including growth in the consumption of fossil fuels. For the first time, however, non-OECD consumption surpassed OECD consumption with China accounting for no less than three-quarters and the Asia-Pacific region for 87% of world energy consumption growth2 . The term “primary energy consumption”, however, embraces a wide variety of energy sources.
Oil and gas are critical parts of this energy mix. Oil and gas are also the most valuable of Arctic natural resources. Table 3.7 shows the absolute and relative growth between 1998 and 2008 in consumption of oil and gas by countries important to this study. Canada apart, the developed economies in this table would appear to be reaching a consumption plateau as far as oil is concerned. Japan is the exception in having reduced her consumption by a significant 12.5%.
As far as international trade in oil is concerned, the year 2009 was highly significant in another way. For the first time Saudi Arabia exported more oil to China than to the US. The global economic recession caused an economic slowdown in both the US and China. In the US it caused a 10% drop in oil consumption. China’s economy also slowed down but
has been quicker to begin the process of recovery. “While the exports of the United States might rebound this year, in the long run the decline in American demand and the growing importance of China represent a fundamental shift in the geopolitics of oil.” Saudi exports to the United States fell to 989,000 barrels a day, the lowest level in 22 years, from 1.5 million
barrels in 2008. China’s imports of Saudi oil nearly doubled from 2008 to exceed a million barrels a day3 .
When we turn to gas consumption, however, Table 3.7 conveys a different picture. Except a rather modest US increase of gas, the developed economies have increased their consumption a great deal. The increase in the consumption of gas of Japan, set against the drop in oil consumption, suggests a policy of substitution on the part of Japan. This may also apply to the EU. Environmental considerations as well as technological developments are factors likely to be behind these changes. The outstanding features of Table 3.7 are, of course, the increase in the consumption of China and India. Both countries produce oil and gas, and Table 3.8 shows the relationship between consumption and production in China and India in 1998 and 2008. The gap between consumption and production of oil and gas is likely to rapidly grow in the years ahead.
Table 3.7: Oil and Gas Consumption Trend
Oil (Million tonnes) Gas (Million tonnes o.e.)
1998 |
2008 |
Change 1998-2008 |
1998 |
2008 |
Change 1998-2008 |
|
US |
863.8 |
884.5 |
2.4 % |
575.3 |
600.7 |
4.4% |
Canada |
86.7 |
102.0 |
17.6 % |
75.1 |
90.0 |
19.8% |
Japan |
253.6 |
221.8 |
-12.5 % |
59.5 |
84.4 |
41.8% |
EU |
703.5 |
702.6 |
0.04% |
372.9 |
441.1 |
18.3% |
China |
197.0 |
375.7 |
90.7% |
18.2 |
72.6 |
298.9% |
India |
92.5 |
135.0 |
5.9% |
22.0 |
37.2 |
69.1% |
Russia |
123.7 |
130.4 |
5.4% |
318.5 |
378.2 |
18.7% |
Source: BP Statistical Review of Energy 2009. Data from various tables in the Review
Table 3.8: Oil and Gas Consumption and Production Trends
India China
1998 Oil Consumption - Production Deficit |
92.5 -34.7 57.8 |
1998 Gas Consumption -Production Deficit |
22.0 -22.0 0.0 |
1998 Oil Consumption -Production Deficit |
197.0 -160.2 37.2 |
1998 Gas Consumption -Production Surplus |
18.2 -21.0 +3.7 |
2008 Oil Consumption -Production Deficit |
135.0 -36.1 98.9 |
2008 Gas Consumption -Production Deficit |
37.2 -27.5 6.7 |
2008 Oil Consumption -Production Deficit |
375.7 -189.7 186.0 |
2008 Gas Consumption -Production Deficit |
72.6 -68.5 4.1 |
Source: BP Statistical Review of World Energy 2009. Data from various tables in the Review
Given their enormous populations, both China and India (and other developing countries) will have to consume energy in quantities much greater than today to reach anywhere near the same level of economic development of today’s advanced economies.
These observations concern mainly the demand side of oil and gas. The supply side was summed up by the BP Group Chief Executive Tony Hayward in the BP Statistical Review 2009. “Our data confirm that the world has enough proved reserves of oil, natural gas and coal to meet the world’s needs for decades to come. The challenges the world faces in growing supplies to meet future demand are not below ground, they are above ground. They are human, not geological
”2 .
At the end of 2008 world proved reserves of oil stood at 1258 billion barrels and proved reserves of gas at 185.02 trillion cubic metres4 . At the end of 2008 the US had 30.5 billion barrels of proved oil reserves. The National Petroleum Council of the US estimates, however, that 1124 billion barrels are still underground “of which 374 billion barrels would be recoverable with current technology”. The USGS “estimates that the earth’s remaining conventional oil (petroleum) deposits to be around seven trillion to eight trillion barrels”. Even if only part of that oil can be recovered economically with today’s technology, know-how and prices and be classified as proven reserves, the numbers are still staggering. Furthermore, only about a third of the sedimentary basins of the earth – the geological formations that may contain oil - have been thoroughly explored with modern technologies5 .
An important element in any assessment of possible reserves is the role of technology. The recovery of oil is a three stage process as depicted in Figure 3.1 below. Only an average of 35% of the oil known to be underground has been recovered, that is to say, oil recovery is still in its secondary stage. Tertiary recovery is partly still experimental and subject to the development of new and better recovery technology. The invention of new technology, however, has always been a driving force in the petroleum industry. It has time and again rendered estimates about the size of reserves invalid and caused upward revisions5 .
Figure 3.1: Three Stages of Recovery of Oil
Primary |
Secondary |
Tertiary |
Recovery up to 15 % Reservoir’s internal pushes oil out |
Recovery up to 20% to 40% Water or natural gas are pumped into the ground forcing more oil out |
Recovery up to 60% Chemicals, heat or pressures microbes thin out the remaining oil |
Source: Maugeri, Leonardo (2009)
From an Arctic point of view the supply of gas is especially significant since so much of Arctic reserves are believed to consist of gas. In 2008 world proved reserves of gas stood at 185.02 trillion cubic metres having increased from148.01 trillion cubic metres in 1998, or by 25.0%. US reserves of gas increased between 1998 and 2008 from 4.65 trillion cubic metres to 6.73 trillion cubic metres, or by 44.7% whereas Russian reserves declined from 43.52 trillion cubic metres in 1998 to 43.3 trillion cubic metres in 2008 or by - 0.5%. In 2008 the US and Russia stood for 22 and 13.9% respectively of total world consumption of gas.
The increase in world gas reserves is partially a result of technological innovation. It will affect Arctic regions more than others and those of Russia in particular since so much of the latter’s gas reserves are supposed to be in her Arctic territories. Above a reference was made to the increase in US gas reserves of 41.4% between 1998 and 2008. In 2008 the US produced 7.5% more gas than it did in 2007. Some of this increase was due to technological developments that have made it possible to turn to unconventional sources for added supply by exploiting previously almost inaccessible shale gas deposits. By employing two relatively new technologies, horizontal drilling and hydraulic fracturing, the US proved reserves of shale gas increased from 21,735 billion cubic feet in 2007 to 32,825 billion cubic feet in 2008, or by a staggering 51% in just a year. Production increased from 1,184 to 2,022 billion cubic feet, or by 70.8%. Shale gas reserves in 2007 accounted for 9.1% of gas reserves, and in 2008 13.6% and are by all accounts likely to increase considerably.
The search for and recovery of shale gas has been going on for some time in the US and less so in Canada but is now spreading to countries in Europe like France, Germany and Poland and to other parts of the world. China and India are among the countries which are thought to have potentially large quantities of shale gas. Because so little drilling has been done outside North America, estimates of the quantities of shale gas that may be found globally vary a great deal. Yet, “even the most conservative estimates are enormous projecting at least a 20% increase in the world’s known reserves of natural gas”6 .
World Oil and Gas Production and Consumption |
To be able to form a view of the significance of the natural resources of the Arctic, they must be seen in the wider context of global resources.
Table 3.9: Top Oil and Gas Producers in 2007
Country |
Oil million tonnes |
% Share of total |
Country |
Gas million tonnes o.e |
% share of total |
---|---|---|---|---|---|
S. Arabia |
493.1 |
12.6 |
Russia |
546.7 |
20.6 |
Russia |
491.3 |
12.6 |
US |
499.4 |
18.8 |
US |
311.5 |
8.0 |
Canada |
165.3 |
6.2 |
Iran |
212.1 |
5.4 |
Norway |
80.7 |
3.0 |
China |
186.7 |
4.8 |
Algeria |
74.7 |
2.8 |
Mexico |
173.0 |
4.4 |
S.Arabia |
68.3 |
2.6 |
Canada |
158.9 |
4.1 |
UK |
65.2 |
2.5 |
UAE |
135.9 |
3.5 |
China |
62.4 |
2.4 |
Venezuela |
133.9 |
3.4 |
Turkmenistan |
60.7 |
2.3 |
Kuwait |
129.6 |
3.3 |
Indonesia |
60.1 |
2.3 |
Norway |
118.8 |
3.0 |
Netherlands |
58.0 |
2.2 |
Nigeria |
114.2 |
2.9 |
Malaysia |
64.5 |
2.1 |
Total World |
3905.9 |
100.0 |
Total World |
2654.1 |
100.0 |
Source: BP Statistical Review, June 2008, pp. 9 and 25
Table 3.10 gives an indication of where the greatest increase in the consumption of oil and gas will take place in the future. The outstanding feature is the growth in the consumption of the EMEs (Emerging Market Economies)7 . Although all major groups, except the former Soviet Union, increased their consumption somewhat, the EMEs did so by 38%.
The two biggest EMEs are China and India, and Table 3.11 tells a great deal about the weight they carry now and are likely to do in the future as far as consumption of oil is concerned. The US increased hers, Russia and Japan decreased theirs, whilst India increased her consumption by 48.6 per cent between 1997 and 2007, and China hers by no less than 87.8% during those ten years.
In 2007 world energy consumption increased by 2.4% for the fifth consecutive year of above average growth. The Asia-Pacific region accounted for 2/3 of global energy consumption growth, rising by an above-average 5% even though the consumption of an important country like Japan fell by 0.9%. China’s consumption grew by 7.7% and the country stood for half the total growth in 2007. India’s consumption grew by 6.8% whilst the EU consumption declined by 2.2% with Germany registering the world’s largest drop in consumption8 .
Table 3.10: Growth in Oil Consumption by Major Groups of States
Groups of states |
1997 million tonnes |
2000 million tonnes |
2003 million tonnes |
2007 million tonnes |
% Growth 1997-2007 |
European Union |
690.1 |
696.5 |
703.1 |
703.9 |
2.0 |
OECD |
2146.3 |
2199.8 |
2223.2 |
2249.0 |
4.8 |
Former Soviet Union |
187.2 |
173.2 |
176.9 |
183.8 |
- 1.8 |
Other EME’s |
1099.8 |
1185.7 |
1281.7 |
1520.0 |
38.2 |
Source: BP Statistical Review, June 2008, p. 12.
Table 3.11: Oil Consumption Changes by Country over Time
Country |
1997 mill tonnes |
2007 mill tonnes |
Change mill tonnes |
Change % |
US |
848.0 |
943.1 |
95.1 |
11.2 % |
Japan |
265.0 |
228.9 |
- 36.4 |
-13.6 % |
China |
196.0 |
368.0 |
172.0 |
87.8 % |
Russia |
129.1 |
125.9 |
- 3.2 |
- 2.5 % |
India |
86.5 |
128.5 |
42.0 |
48.6 % |
Source: BP Statistical Review, June 2008, p. 12.
Table 3.12: World Top Consumers of Oil and Gas in 2007
Country and groups of countries |
Oil consumption million tonnes and rank |
% Share of oil consumption |
Gas consumption million tonnes of o:e. And rank |
% Share of gas total |
United States |
943. 1 (1) |
23.9 |
595.7 (1) |
22.6 |
China |
368.0 (2) |
9.3 |
60.6 (9) |
2.3 |
Japan |
228.9 (3) |
5.8 |
81.2 (5) |
3.1 |
India |
128.5 (4) |
3.3 |
36.2 (11) |
1.4 |
Russia |
125.9 (5) |
3.2 |
394.9 (2) |
15.0 |
Germany |
112.5 (6) |
2.8 |
74.5 (6) |
2.8 |
S.Korea |
107.6 (7) |
2.7 |
33.3 (12) |
1.3 |
Canada |
102.3 (8) |
2.6 |
84.6 (3) |
3.2 |
S. Arabia |
99.3 (9) |
2.5 |
68.3 (8) |
2.6 |
World total |
3592.8 |
100.0 |
2637.7 |
100.0 |
European Union |
703.9 |
17.8 |
433.7 |
16.4 |
OECD |
2249.0 |
56.9 |
1316.9 |
49.9 |
Other EMEs |
1520.0 |
38.5 |
752.1 |
28.5 |
Source: BP Statistical Review, June 2008, pp. 12 and 28.
Table 3.12 shows that in 2007 the US alone consumed 23.9% of world oil and 22.6% of world gas, China 9.3% of the oil and 2.3% of the gas whilst Russia consumed 3.2% of the oil but 15.0% of the gas.
Despite media headlines and ominous predictions to the contrary, the world would seem not to be running out of oil and gas any time soon. In a speech to the World Petroleum Council in June 2008, the Chief Executive of British Petroleum (BP) said that the “world has more than 40 years of proven oil reserves, 60 years of natural gas and 130 years of coal. Put another way, we have produced around 1 trillion barrels of conventional oil, we’re sitting on another 1 trillion barrels of proven reserves and yet another trillion of non-proven resources. On top of that there are vast quantities of unconventional hydrocarbons9 including oil sands, heavy oil and unconventional oil and gas. And then there are hydrocarbon basins as yet unexplored”10 .
International Shipping Trends |
As the world economy recovers there will be no shortage of shipping to shift goods and merchandise around the globe. The first years of the new millennium were quite remarkable from a shipping point of view. The primary cause of the development was the strong economic growth of the emerging market economies, especially China, and the subsequent demand for shipping.
The good times created among ship owners an optimism that led to a massive ordering of new ships as reflected in Figure 3.4. When the global recession set in, public demand for and spending on finished goods plummeted, followed by a dramatic fall in the demand for primary commodities such as oil, gas and ores, and processed commodities such as steel. This in turn caused a drop in demand for bulk carriers and tankers. It also led to an oversupply of container ships, the like of which one has to go back to the early 1980s to find. In May 2009 almost 10% of the world container fleet lay idle. The Baltic Dry Index, that records bulk ship charter rates, fell almost 97% between July and December 2008 before recovering somewhat in early 2009. Figure 3.3 shows the fate suffered by dry bulk freight rates in 2008.
As in the case of container vessels, owners of bulk vessels had by April 2009 laid up 314 vessels or about 5% of available tonnage of bulk vessels above 10 000 dwt. According to Det Norske Veritas (DNV), orders for 325 bulk carriers, 47 tankers, and 78 container vessels (altogether 37 million dwt) had been cancelled worldwide by May 200911 . By the end of 2009 the world fleet consisted of almost 55 000 ships.
The largest category was general cargo vessels (including other dry cargo) with 33%, tankers of all sorts constitute 26%, dry bulk 14% and containers 9%. Measured in dwt transport capacity the world fleet at end of 2009 is almost 1.3 billion dwt. The distribution is 39% tankers (all types), 34% dry bulk, 13% containers and only 7% for general cargo vessels.
Figure 3.5 indicates that a rapid increase in the world fleet is expected. IHS forecasts a yearly increase of 6-7 per cent for the period 2009-2013, somewhat dependent on the number of orders that are being cancelled. With the financial crisis coming on top of massive over-contracting, international shipping are facing some difficult years.
Figure 3.3: Dry Bulk Freight Rates 1997-2009
Source: IHS
Figure 3.4: Orders for New Vessels
Source: IHS
Figure 3.5: World Fleet Development 1970-2013
Source: IHS
Appendix
Canada
2008 |
2008 |
Share of world total exports 2.84 |
Share of world total imports 2.55 |
By main destination |
By main origin |
1. The US 77.6 |
1.The US 52.4 |
2. European Union (27) 7.5 |
2. European Union (27) 12.5 |
3. Japan 2.3 |
3. China 9.8 |
4. China |
4. Mexico 4.1 |
5. Mexico 1.2 |
5. Japan 3.5 |
Source: World Trade Organization, Trade Profiles, 2009
United States
2008 |
2008 |
Share of world total exports 8.01 |
Share of world total imports 13.2 |
By main destination |
By main origin |
1. European Union (27) 21.2 |
1. European Union (27) 17.4 |
2. Canada 20.1 |
2. China 16.5 |
3. Mexico 11.7 |
3. Canada 15.7 |
4. China 5.5 |
4. Mexico 10.1 |
5. Japan 5.1 |
5. Japan 6.6 |
Source: World Trade Organization, Trade Profiles 2009
Russia
2008 |
2008 |
Share of world total exports 2.93 |
Share of world total imports 13.2 |
By main destination |
By main origin |
1. European Union (27) 56.8 |
1. European Union (27) 42.6 |
2. Turkey 5.9 |
2. China 13.0 |
3. Belarus 5.1 |
3. Japan 7.0 |
4. Ukraine 5.0 |
4. Ukraine 6.1 |
5. China 4.5 |
5. United States 5.2 |
Source: World Trade Organization, Trade Profiles 2009
Germany
2008 |
2008 |
Share of world exports 9.1 |
Share of world exports 7.3 |
By main destination |
By main origin |
1. European Union (27) 63.8 |
1. European Union (27) 58.5 |
2. United States 7.2 |
2. China 7.2 |
3. Switzerland 4.0 |
3.United States 5.6 |
4. China 3.4 |
4. Russia 4.4 |
5. Russia 3.2 |
5. Switzerland 3.8 |
Source: World Trade Organization, Trade Profiles 2009.
Japan
2008 |
2008 |
Share of world total exports 4.87 |
Share of world total import 7.3 |
By main destination |
By main origin |
1.United States 17.8 |
1.China 8.8 |
2.China 16.0 |
2.United States 10.4 |
3.European Union (27) 14.1 |
3.European Union (27) 9,2 |
4.Korea, South 7.6 |
4. Saudi Arabia 6.7 |
5.Taipei, Chinese 5.9 |
5. Australia 5.2 |
Source: World Trade Organization, Trade Profiles 2009
China
2008 |
2008 |
Share of total world exports 8.89 |
Share of total world imports 4.64 |
By main destination |
By main origin |
1.European Union (27) 20.5 |
1. Japan 13.3 |
2.United States 17.7 |
2. European Union (27) 11.7 |
3.Hong Kong, China 13.4 |
3. Korea South 9.9 |
4. Japan 8.1 |
4. Taipei, China 9.1 |
5. Korea South 5.2 |
5. China 8.2 |
Source: World Trade Organization, Trade Profiles 2009
India
2008 |
2008 |
Share of world total exports 1.1 |
Share of world total imports 1.79 |
By main destination |
By main origin |
1. European Union (27) 21.6 |
1. Japan 13.9 |
2. United States 11.8 |
2. China 10.0 |
3. United Arab Emirates 10.5 |
3. United States 7.8 |
4. China 5.6 |
4. Saudi Arabia 7.3 |
5. Singapore 4.9 |
5. United Arab Emirates 6.2 |
Source: World Trade Organization, Trade Profiles 2009
Bibliography
- 1. International Energy Agency (2008)
- 2. BP Statistical Review of World Energy (2009), June 2009
- 3. Mouawad, J. (2010), China’s Growth Shifts the Geopolitics of Oil”, The New York Times, March 19, 2010.
- 4. BP Statistical ….2009, pp 6 and 22. For a different assessment which sets world oil reserves at 850-900 billion barrels, see University of Oxford (2010, March 26). World oil reserves at ’tipping point’. Science Daily . Retrived March 31. 2010, from http:
- 5. Maugeri, L (2009), Squeezing More Oil From the Ground”, Scientific American, 2009 October.
- 6. Clifford Krauss (2009)
- 7. South and Central America, Africa, Middle East, non-OECD Asia, non-OECD Europe.
- 8. BP Statistical Review of World Energy (2008), June 2008
- 9. Uncoventional oil resources in the world exceeds considerably the amount of conventional oil reserves but are much more difficult and expensive to develop. Wikipedia. Oil Reserves. http://en.wikipedia.org/wiki/
- 10. See http://www.bp.com/genericarcticle , Speech date 30 June 2008, World Petroleum Council, Madrid
- 11. Joint Transport Research Centre of the OECD and the International Transport Forum, Transport Outlook 2009, Globakisation, Crisis and Transport, Discussion Paper No 2009-12, May 2009, preliminary version.
Arnfinn Jørgensen-Dahl, 2010, World Economic and Shipping Trends , CHNL.©