• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 23 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 2 hours How Far Have We Really Gotten With Alternative Energy
  • 4 hours If hydrogen is the answer, you're asking the wrong question
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 5 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 17 hours Biden's $2 trillion Plan for Insfrastructure and Jobs
  • 4 days "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)

Oil Price Crash Could Wipe Out $131 Billion In New Projects

The double supply-demand shock in the oil market could lead to companies deferring as much as $131 billion worth of oil and gas projects slated for approval in 2020, with everyone in the industry--from Big Oil to the small players--is feeling the pain of the oil price crash and looks to weather the storm. 

According to an impact analysis from Rystad Energy, oil and gas firms could reduce total project sanctioning this year to just $61 billion at Brent Crude average of around $30 per barrel in 2020. This spending forecast compares to previous estimates from Rystad that as much as $190 billion worth of investments would be sanctioned this year. Of the $61 billion investments expected to receive approval this year at $30 oil, half would be onshore and the other half offshore, according to Rystad Energy, which sees Brent at average $30 “an increasingly likely scenario.” 

“Upstream players will have to take a close look at their cost levels and investment plans to counter the financial impact of lower prices and demand. Companies have already started reducing their annual capital spending for 2020,” Audun Martinsen, Rystad Energy’s Head of Energy Service Research, said in a statement. 

From U.S. shale producers to Big Oil, everyone in the industry is bracing for pain at $30 oil, and companies are rushing to announce capital expenditure (CAPEX) cuts. 

One of the major projects expected to receive final investment decision this year is ExxonMobil’s Greater Liza development offshore Guyana, which encompasses the Payara and Pacora discoveries, according to Rystad Energy. 

But in North America, “multi-billion dollar oil projects, including LLOG-operated Shenandoah Phase 1 and the Shell-operated Whale development, could face short-term delays in the offshore sector due to low oil prices, while in the onshore sector operators are expected to wait for the situation to stabilize before committing to new projects,” Rystad Energy said.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

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