Oil, Gas Investments Must Rise to $523 Billion a Year, Says IEF
Wallace and Matthew
Riyadh-based think tank echoes Saudi Aramco’s call this week
Lack of investment will cause economic unrest, says the IEF
Energy Forum has called on companies to raise investment in
oil and natural-gas production to $523 billion a year by the end of
this decade to prevent a surge in energy prices and economic unrest.
think tank’s comments echo those of Saudi
Aramco, whose chief executive officer on Monday said there
could be “chaos”
unless governments stopped discouraging investment in fossil fuels.
IEF said spending on oil and gas projects slumped 30% to $309 billion
in 2020 and had only recovered slightly this year. It needs to reach
$4.7 trillion over this decade as a whole to meet demand, according to
the organization’s forecasts.
next two years are critical for sanctioning and allocating capital
toward new projects to ensure adequate oil and gas supply comes online
within the next five or six years,” the IEF said in a report.
“Insufficient upstream investment would result in more price
volatility and spur adverse economic consequences.”
Riyadh-based IEF says the world needs more investment in oil and gas.
Source: IEF, IHS Markit
2025 and 2030, IEF estimates for amount needed to balance energy
That’s at odds with what most climate activists and some major energy
bodies say is necessary to slow the warming of the planet. The International
Energy Agency, which advises rich countries, has called for
the cessation of
new investment in fossil fuels if the world is to neutralize carbon
emissions by 2050.
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Organization of Petroleum Exporting Countries and companies such as
TotalEnergies SE have said it
will be years, if not decades, before renewable forms of energy can
fully replace oil and gas.
They have said oil’s surge this year to more than $70 a barrel could
continue without more money being put toward fossil fuels.
“Publicly admitting that oil and gas will play an essential and
significant role, during the transition and beyond, will be hard for
some,” Aramco’s CEO, Amin Nasser, said at the World Petroleum Congress
in Houston. “But admitting this reality will be far easier than
dealing with energy insecurity, rampant inflation, and social unrest
if prices become intolerably high.”
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