Global oil output to peak in 2010

by Andrea Hotter

Global oil output could reach its production peak by 2010 leaving increasing emphasis on the use of agricultural products for energy supply, Stephan Wrobel, chief executive of Swiss-based asset management fund Diapason Commodities Management told the Dow Jones European Commodity Investment conference in Frankfurt.
"Currently the world derives some 60 % of its energy from fossil fuels but these supplies are limited -- the global 'production peak' of oil could be reached by around 2010," Wrobel said.

"Clean and renewable fuels can be made out of corn, canola, soybean, palm oil, rice, sugar cane. As prices of these commodities are still at low levels they offer interesting economic, and environmental friendly alternatives," he added.
The US currently produces bio-diesel, which is mostly made out of soybean oil, at the rate of about 20 mm gallons a year, Wrobel said. Although bio-diesel does have the capacity to produce more than 50 mm gallons annually, he added.
"Until 2010, the global consumption of bio-oils and fats is forecasted to rise by 2.5 % annually," according to Wrobel.

Rapeseed is the primary feedstuff for making biodiesel in the EU, while sugar beet and grains such as wheat, barley and corn are used for making ethanol.
Positive supply side factors in the agricultural markets and rising demand for biofuels encouraged Diapason to launch the UBS Diapason Global Biofuel Index. The index, a joint venture with Swiss bank UBS, is the first commodity-based index for biological fuels and will cover a range of commodities used in the production of ethanol and biodiesel. Diapason is based in Lausanne, Switzerland, and London.