Following the energy crisis that affected most global energy markets last year, and the commodity-related fallout from Russia’s invasion of Ukraine, oil and gas industry players are eyeing a new bullish outlook for energy prices, with sector investment following suit.
In BloombergNEF’s “base-case” scenario, which considers the current state of play, money flowing into oil and gas will grow in 2023 against previous years, topping $880 billion.
Sector spending will reach a new high this year and decline slowly through 2050, although it will remain elevated overall, said BloombergNEF oil analyst Claudio Lubis.
Of total investment last year, including upstream, midstream, and downstream, $501 billion was in oil supply and $260 billion in gas supply, BloombergNEF calculated.
The sector saw rapid growth in investment in the early part of the 2010s, reaching a peak in 2014 following the oil price rally.
Investments fell swiftly in line with the weak commodity cycle, reaching a new low around 2020 when the benchmark WTI crude oil indicator went into negative territory for the first time at the height of the Covid-19 pandemic.
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