Saudi Arabia's oil giant Saudi Aramco is warning again that if the oil and gas industry doesn't start investing again, the global oil supply/demand curve will reach a turning point in "a couple of years," Aramco's CEO Amin Nasser said on Monday, noting that the oil price crash that began in 2014 has already wiped out US$1 trillion worth of investments.
"About $1 trillion in investments have already been lost since the current downturn began," Nasser said in a speech at the World Petroleum Congress in Istanbul today.
Shortly after his speech, the manager told CNBC:
"A lack of investment is definitely not helping, so if that continues over the next couple of years there will be an inflection point."
While analysts and investors are currently worried that OPEC and Saudi Arabia are not doing "whatever it takes" to balance the oversupplied market, Aramco's chief executive was speaking of the long-term supply/demand dynamics, reiterating his stance that peak oil demand is nowhere in sight and "the world can't prematurely disengage from proven and reliable energy sources like oil and gas."
The US$1 trillion worth of investments that were never made due to the downturn is a "cause for concern to global energy security," according to Nasser.
"About $1 trillion in investments has been lost in the current downturn, concurrent to growing oil demand and the natural decline of developed fields. Conservative estimates suggest we need about 20 million [additional] barrels per day over the next five years to counter these effects," he noted.
Related: The Other Culprits Of The Oil Price Crash
Referring specifically to Saudi Aramco's investment plans, Nasser said in his speech, as carried by Aramco's website:
"We plan to invest more than $300 billion over the coming decade to reinforce our preeminent position in oil, maintain our spare oil production capacity, and pursue a large exploration and production program centering on conventional and unconventional gas resources."
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