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APAC Oil & Gas Pipeline: Intertwined With China-India-Japan?

APAC Oil & Gas Pipeline

Revival of talks on the non-starter Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline holds strong implications for the Asia Pacific (APAC) oil & gas pipeline market. While several net energy exporting economies such as UAE, Russia, Qatar etc. are feeling the pinch of losing valuable petrodollars, energy importers such as India and China are making serious moves to consolidate supply lines.

Weakening position of net energy exporters is giving energy importers a solid bargaining position. Experts who worked on TechSci’s report Asia-Pacific Oil & Gas Pipeline Market, Competition Forecast and Opportunities, 2012–2022” clarified certain APAC oil & gas market trends for us.

APAC Oil & Gas Pipeline Market: Through the Perspective of CGD

APAC oil & gas pipeline market size is one of the biggest in the world, valued at $13.33 billion in 2016. It is also one of the fastest growing, with the growing rate of real wages and a steadily improving supply side primarily the APAC oil & gas market.

For example, India and China are both looking to enhance their city gas distribution (CGD) networks in order to streamline energy supplies. In fact, China’s National Development and Reform Commission (NDRC) just last month came out with a set of guidelines aimed at lowering CGD delivery costs and optimizing the system. Such reforms are expected to boost APAC oil & gas pipeline market.

India also, as per India City Gas Distribution Market, Competition Forecast & Opportunities, 2013 – 2030” natural gas consumption is set to cross 18 BCM by 2030. To achieve such an ambitious target, the government is increasingly targeting CGD infrastructure for delivery of hydrocarbons. APAC oil & gas pipeline market would thus become extremely important in this regard.

Development in Asia Boosting APAC Oil & Gas Pipeline Market

One of the major reasons for the growth in APAC oil & gas pipeline market is the growth being observed in the region. Sustained levels of growth in the region and improving quality of life has put pressures on countries to import more and more oil to try and feed their respective oil addictions.

World bank notes that net energy imports (as a % of energy use) in South Asia have skyrocketed over the past 2 decades. From 21.3% in 2000 to 32.7% in 2014. The change has been stupendous, and been a backbone of the developments being observed presently in the APAC oil & gas pipeline market.

This is in addition to the three major economic powerhouses in the region. The India-China-Japan troika, are 3 of the 4 biggest consumers of oil in the world. With India and China being the 2 fastest growing large economies, and the Japanese economy recording a sustained recovery, there is a strong possibility that supply constraints would provide a strong push to APAC oil & gas pipeline market.

In addition to the 3 aforementioned countries, there has also been a surge in energy demand from countries such as Indonesia, Thailand, Vietnam etc. Given that net energy importers are slowly casting doubts aside to fully embrace cheap oil, it seems that the demand for APAC oil & gas pipeline market will grow fast in the next few years.

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