LONDON, JUNE 18, 2011 (BULLETIN Reuters) - Gas was the preferred energy investment pick of executives, analysts and investors attending a Reuters summit this week, beating solar and nuclear by a wide margin.

Over 60 percent of those at Reuters' Energy and Climate Summit this week chose natural gas. None picked coal.

"There is clearly a tremendous amount of gas on a global basis, but there is also a great increase in the global demand for gas and that can only accelerate as we try to move away from an oil-based global economy," said Stephen Trauber, head of energy at Citigroup.

The International Energy Agency forecast on Thursday that global gas demand will rise nearly 14 percent by 2016 as it becomes a preferred fuel of choice for power generation, a prospect which could start a "golden age" of gas by 2035 when the demand for gas could near that of oil.

The development of unconventional gas sources in the U.S. and Australia has lifted the outlook for gas supply, while a global political drive to reduce greenhouse gas emissions has made gas a cleaner and more attractive alternative to burning carbon-intensive coal and fuel oil for power generation.

"By 2050, probably 60 percent or more (of energy demand) will still come from fossil fuel and that stresses why we need to deal with the emissions of those sources," said Graeme Sweeney, executive vice president of CO2 at Shell.

Gas as alternative to nuclear The nuclear power incident at Japan's Fukushima in March strengthened public opposition to nuclear, which led Germany to permanently close some of its oldest nuclear power plants.

Italians also voted in referendum earlier this week to reject the nuclear renaissance in their country which is likely to result in even higher gas dependence.

"Germany is an ideal example that an alternative to nuclear has to be gas," said Lloyd's Head of Oil and Gas Andrew Moorfield.

"Gas is probably the only viable relatively clean carbon fuel source, this clearly has an implication for long term gas prices."

But growing demand for gas in emerging economies in Asia has tightened the outlook for European supply, especially as the development of unconventional gas is widely expected to be minimal in Europe.

Experts believe European shale gas exploration will be limited due to environmental concerns and logistical problems because of restricted access.

"The big unknown for the gas development in general lies in Chinese attitude toward unconventional reserves. Will they develop them? If they do, will it suppress their imports? Could they turn exporter?" said Emmanuel Fages, head of power, gas, carbon and coal research at Societe Generale.

Chief News Editor: Sol Jose Vanzi

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