ABSTRACT
Industry and government have no choice but to continue with the art of estimating medium- and long-term trends, but decision makers pay far less attention to these exercises than they did in the past. The track record of energy forecasts in the 1970s and early 1980s has been rather poor, and the people engaged in an occasional exercise of estimating the future path of every demand and of supply and prices have become very cautious. The difference between 2 and 3 percent growth will have a major impact on the energy outlook. The short-lived abandonment of surplus management in 1986 caused Organisation of Petroleum Exporting Country (OPEC) revenue to drop 42 percent in one year to $75 billion and the revenue decline was compounded by dollar depreciation. World economic developments and OPEC's ability to manage the oil supply surplus will not only affect the short-term energy outlook but will also have an important bearing on longer.
