The Greek energy market is showing signs of growth but it is still in a transition course, a survey by Kantor Capital said on Wednesday.

 The report said that the Greek electricity market has not been fully opened yet and noted that prices were effectively pushed higher. Natural gas penetration is lower, compared with initial forecasts, due to delays in private investments in electricity production, while in the oil product market demand is expected to slow because of increased presence by natural gas supplies in the country, the report stressed.

 For the electricity market, Kantor Capital said that increased cross-border electricity energy trade could help in harmonizing prices in the European Union and lower costs, while electricity demand in Greece would continue rising, a development combined with delays in private electricity production that could result to an energy deficit after 2007 and higher domestic prices. Demand growth rates remained high (average annual growth rate of 4.4 percent in the last 10 years), more than double the EU average growth rate (2.1 percent), the report stressed.

 The report noted that delays in private electricity production were attributed to low consumer prices. Kantor Capital expects a maximum of two new producers to enter the country's electricity grid by the end of 2007 with Public Power Corporation remaining the dominant player in the market.

 In the natural gas market, demand -worldwide- is forecast at 2.2 percent by 2025 (exceeding growth rates for oil and coal 1.9 pct and 1.6 pct, respectively), a trend needing investments of around three trillion dollars in the next 30 years, the report said. Kantor said that the Greek natural gas market was growing slowly but the market still had positive growth prospects for the future.

 World oil demand was 2.1 percent higher from the average annual growth rates in recent years in 2003, with total production up 3.8 percent over the same period, the report said. Average prices last year were the highest in the last 20 years. For the domestic market, the report forecast a slowing growth rate in the oil product market and stressed that a merger between Hellenic Petroleum and Petrola would lead other companies in the sector to re-adjust their strategies.

Source: Athens News Agency

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