The global energy industry entered the year 2005 with rising oil prices, uncertainty about future trends in oil prices, rising shares of developing countries in the world energy consumption contributing to continued domination of use of fossil fuels in the energy mix and serious concerns about energy security.

Globalization and continued liberalization of international trade and investment since the 1990s, the political and economic transformation of Eastern Europe and the Former Soviet Union (FSU) and the events since 2001 are changing the global energy industry in the new millennium. The fall of the Berlin Wall in 1989 signalled the failure of the command and control economy. Most of the world recognized the need for the changing role of the state from being the owner to the facilitator of business. For the first time many world economies embarked on the path of liberalization by moving toward the market by opening up trade, by deregulating their economies and by privatizing public enterprises.

The waves of economic globalization and continued liberalization of international trade and investment are most evident in the global energy industry. All segments of the global energy industry from exploration and production (E&P), transportation, refining and marketing to the power utility sector, are being shaped since the 1990s by the emerging trends and influences of the new market dynamics. Given that developing countries started to reform their energy sectors modelled on developed countries since the 1990s, the changing international energy industry, (including the ongoing energy market reforms in OECD countries) has implications for developing countries.