Latest update November 8th, 2024 1:00 AM
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Guyana and Brazil to lead Latin America oil boom for the next five years – Report
Kaieteur News – In a surprising turn of events, Latin America is set to experience a significant oil boom over the next five years, as projected by the International Energy Agency (IEA). The agency has noted that despite the ongoing climate change crisis, global oil production is expected to increase, with Brazil, Guyana, and Argentina leading the charge.
These three nations are poised to account for a quarter of the world’s oil production, marking a new chapter in the region’s energy landscape.
A report by ‘The Economist’ was keen to note that the era of oil dominance once limited to countries like Venezuela, Mexico, Ecuador, and Colombia appears to be shifting. It also noted Francisco Monaldi, Director of the Latin American Energy Program at the Baker Institute in Texas, suggesting that these earlier oil-producing countries might find it difficult to reverse their decline. Instead, the spotlight has shifted to Guyana, Brazil, and Argentina as they embrace a fresh wave of oil production.
It said that Guyana, which was often considered a small and economically challenged nation, experienced a seismic transformation following the discovery of significant oil reserves in the Stabroek Block offshore by ExxonMobil in 2015. Now, with estimated proven reserves of around 11 billion barrels, Guyana is poised to become the country with the highest oil wealth per capita in the world, potentially surpassing even Kuwait. This newfound wealth it says has driven Guyana’s per capita income to increase ninefold over the past two decades, solidifying its position as the world’s fastest-growing economy.
Meanwhile, Brazil, the giant of Latin America, stands as another formidable player in this impending oil boom. It was revealed that the country boasts vast underwater oil deposits, positioning it as one of the world’s largest marine oil sources. Further, the report said that in 2017, Brazil overtook Mexico to become Latin America’s top oil producer, a trend that has continued as its oil production surged to 2.2 million barrels in 2022. What sets Guyana and Brazil apart is not just their production volume, but also their commitment to more efficient, profitable and sustainable oil extraction methods. Both countries emit a lower amount of CO2 per barrel produced compared to many other nations, making their endeavours seemingly more environmentally conscious.
However, the report was keen to note that the projected oil boom is not without its complexities. It said that as the global energy landscape evolves, renewable energy sources are anticipated to gain more prominence in the latter part of the decade, potentially altering the trajectory of oil demand and production. Emphasis was also placed on the fact that the balance between fossil fuels and renewable energy remains a critical consideration for policymakers and industries alike.
While Latin America is on the cusp of a significant oil boom, with Guyana and Brazil emerging as the primary drivers of this transformation it is also important that a watchful eye is kept on how the citizens will benefit.
In addition, as the world grapples with climate change concerns, the region’s newfound oil prospects present both opportunities and challenges for the years to come.
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