Rosneft chief executive Igor Sechin said that the rebound in global demand for oil and gas and the gap between supply and demand could lead to a new supercycle for oil and gas
The rebound in global demand for oil and gas and the gap between supply and demand could lead to a new supercycle for oil and gas, Rosneft's chief executive Igor Sechin said on Friday.
"Despite the uncertainty in the global economy due to the difficult epidemiological situation, we observe a rapid growth in demand for traditional energy resources," Sechin said in a statement, commenting on Rosneft's Q3 earnings and the outlook for the future.
"As structural discrepancies between supply and demand on global energy markets are further revealed, we may witness a new super cycle on the oil and gas markets. Under these conditions, the Company holds responsible to the consumers of our energy products and increases investments into the new projects," the top executive of Russia's largest oil producer said.
Rosneft's CEO became the latest oil industry official to say that already high oil and gas prices could rise even further.
At the end of last month, Saudi Aramco's chief executive Amin Nasser said that crude oil production capacity was dwindling globally, and more investments in new production are needed urgently.
Earlier this week, Nasser said that the world would see its level of spare oil production capacity dwindle next year as jet fuel demand returns to pre- or near-pre-crisis levels.
"Expanding capacity in our industry takes around 5-7 years, and there is not enough investment in the world to increase capacity, this is a huge concern," Nasser said at the Nikkei Global Management Forum, as carried by Reuters.
Global annual upstream spending needs to increase by as much as 54 percent to $542 billion if the oil market is to avert the next supply shortage shock, Moody's said last month.
"Our analysis demonstrates that upstream companies will need to increase their spending considerably for the medium term to fully replace reserves and avoid declines in future production," Moody's Vice President Sajjad Alam said.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More