OPEC Secretary General Warns Of Underinvestment In Oil And Gas Sector

Underinvesting in the oil and gas sector could cause market volatility in the long term, OPEC Secretary General Haitham Al Ghais said.

• The world should focus on investment in all energy sectors, instead of replacing one source of energy with another, he added. OPEC estimates that the world needs $12.1tn in investments to meet rising oil demand in the long term.
• With global oil demand growth at around 8mbpd, the world could face a supply problem as Western sanctions on Russian oil curtail production growth, Fereidun Fesharaki, chairman of the FGE Consultancy, said.
• Russia can maintain production at around 10-11mbpd but 2mbpd of future growth are unlikely to go ahead with sanctions in place, Fesharaki added.
• Fesharaki also said he saw OPEC behaving in a very different way than it used to with US shale oil growth no longer a worry with higher prices and instead OPEC shifted its focus to monetising oil resources before demand peaks.
• He said the group has "a desire to keep oil prices above $80 a barrel and a willingness to go over $100 if the market tightens".
• The next OPEC+ ministerial meeting is scheduled for 3-4 June.
• OPEC+ crude oil output in April fell by 191kbpd on the month to 28.60mbpd, according to the group’s monthly oil market report.