• 3 minutes Australian power prices go insane
  • 7 minutes Wind droughts
  • 11 minutes  What Russia has reached over three months diplomatic and military pressure on West ?
  • 16 hours Is Europe heading for winter of discontent with extensive gas shortages?
  • 35 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 43 mins What-If - Russia decided to take out the Saudi and Kuwait oilfields
  • 19 hours "As the Earth Cools, the Climate Change Hoax Heats Up" by Michelle Edwards
  • 19 hours "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 3 days "Mexico Plans to Become an Export Hub With US-Drilled Natural Gas" - Bloomberg - (See image)
  • 3 days "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 16 hours 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 16 hours The United Nations' AGENDA 2030 - The vision for One World Governance ...an article by the famous Dr Robert Malone
  • 22 hours PROFOUND ! "Russian Ruble relaunched linked to Gold and Commodities" by the famous Ronan Manly -- (NOTE the censorship by the MultiPolar New World Order of The Great Reset))
Michael Kern

Michael Kern

Michael Kern is a newswriter and editor at Safehaven.com and Oilprice.com, 

More Info

Premium Content

A Nightmare Scenario For Offshore Oil

Between low demand, soaring inventories, depressed prices, a global pandemic, and now, hurricane season, it seems a perfect storm is forming around the offshore oil industry.  The world's offshore oil market, responsible for 30 percent of all the world's oil production, is facing an impossible set of challenges. With oil sitting at half the price of its yearly high, and doubts forming around the future of demand, in addition to the ongoing COVID-19 pandemic wreaking havoc on the global economy, companies are struggling to rein in capital spending and are beginning to rethink the future of key projects. 

The crisis has pushed much of the world's oil production onshore in favor of more flexible rigs and lower operational costs. 

Many new offshore projects have even been put on hold as the new reality of the oil market sets in. Companies are now scrambling to suspend federal lease deadlines as the near-term looks increasingly uncertain. 

The industry's growing troubles come just as Royal Dutch Shell was forced to airlift a number of coronavirus-infected employees from one of its offshore platforms, highlighting the risks associated with confining workers on offshore rigs during a pandemic. 

And Shell isn't the only company grappling with outbreaks. 

Related: Oil Prices Are Unlikely To Break $40 This Year

In recent weeks, hundreds of workers at offshore rigs in the Gulf of Mexico, the North Sea, Mozambique, Canada, and Kazakhstan have been infected with COVID-19. 

The outbreaks add to the growing list of trials and tribulations the offshore industry is grappling with. 

Many firms operating offshore rigs have yet to recuperate from the last oil price collapse in 2014-2015 when prices fell from $100 to below $40, weighing on the entire industry. 

“Offshore drillers and offshore vessel providers will generally be unable to pay their total outstanding debt of 2020 based on their cash flow from operating activities, unless they are able to make sufficient capital expenditure cuts,” Jon Marsh Duesund, a partner at energy research firm Rystad Energy explained, adding, “Otherwise, they will have to turn to capital markets for refinancing.”

And with the global economy teetering on the brink, the industry may not be able to secure the funds it needs to stay afloat.

By Michael Kern for Oilprice.com 

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • SPM on May 31 2020 said:
    Which offshore platforms in Canada have been impacted by actual COVID cases on the platforms? I know in the onshore fields this is an issue in Canada, but not offshore as far as I know.
  • Frank Campbell on June 01 2020 said:
    Thanks again, Comrade Covid! That virus has done more good for the future of mankind than every government, corporation, and activist group combined.

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News