Arab unrest, nuclear fears may cause energy crisis

The world may soon face an energy crisis, as oil output faces renewed threats in Arab countries and the future of nuclear power is debated in the wake of the Japanese Fukushima disaster.

Global crude supply has dropped by 1.1m barrels per day (bpd) due to Libya's civil war, reducing Opec's reserve capacity to a mere 2m bpd. Recent violence in Bahrain could easily begin to affect Gulf output, which is so far steady.

Japan has shut down its 11 reactors amid fears of a meltdown. Meanwhile, Germany has imposed a moratorium on the renewal of 17 power plants, and China has suspended construction of 25.

Alternative energy sources, such as coal and natural gas, are needed to fill the gap, which will increase the pressure on fossil fuels. According to Eduardo Lopez from the International Energy Agency, Japan will need "an extra 200,000 bpd of fuel oil and light crude".

Nuclear power currently accounts for 13.8 per cent of the world's electricity - and that's much higher in the developed world.

Read a full report in the Daily Telegraph. ·