A protracted period of dramatically lower oil prices has ushered in momentous challenges for Gulf Arab states and oil producing countries around the world. Oil markets are in uncharted territory, transformed by the advent of U.S. shale oil, set adrift by OPEC’s policy of pursuing market share, weighed down by a massive supply surplus, and searching for a new, higher price floor. The fiscal pressures brought on by lower oil prices have set in motion long-awaited economic restructuring of government-related entities and a fundamental shift in domestic energy policies of Gulf oil exporters. But as the Gulf states prepare for a post-oil economy, the renewable energy sector offers opportunity for investment, economic growth, and sustainability.
As part of the Energy series, AGSIW explores the drivers of the oil price outlook, upstream oil investment strategies, economic and energy policy reforms in the Gulf Cooperation Council, and renewable energy. The series includes the annual Petro Diplomacy conference and conference report, public panels, expert roundtables, analysis papers and policy briefs, and a Bridge blog series on energy.
By Diane Munro
March 15, 2018
OPEC may need to maintain crude oil supplies at current lower levels for longer than planned, as surging U.S. shale oil dominates global oil markets for the next several years, according to a new report from the International Energy Agency (IEA). The historic OPEC and non-OPEC cooperation pact to lower production targets has provided a strong foundation for a reversal of fortunes in global oil markets since the end of 2016, with surplus global inventories sharply contracting and oil prices 25 percent higher than a year ago. However, as widely expected, the recovery in oil markets paved the way for sharp growth in U.S. shale oil production, the latest data from the IEA’s 2018 annual medium-term outlook show.
March 5, 2018
As part of its energy series, AGSIW was pleased to host a private roundtable discussion with Majid Al-Moneef, former secretary general of the Supreme Economic Council of Saudi Arabia and member of the board of directors for Saudi Aramco, examining the energy dimension of Saudi Arabia’s reform programs.
September 25, 2017
The international oil industry is in the midst of writing a new chapter in its long-storied history, with a massive restructuring underway to meet the challenges of a new lower oil price world. For its third annual conference, AGSIW brought together experts from the oil industry, finance, government, and academia to discuss critical issues facing the oil industry against the background of the shifting economic and political landscape in the region.
April 19, 2017
AGSIW was pleased to host a roundtable discussion with Majid Jafar, CEO of Crescent Petroleum, in conversation with Roger Diwan, vice president of IHS Financial Services at IHS Markit. Jafar began by outlining how the energy sector has changed over the years. About 20 years ago, oil was $12 dollars per barrel and natural gas was $60 dollars per barrel. Inversely, oil is now $60 dollars per barrel and natural gas is $12 dollars per barrel. The United States is converting import terminals to export terminals to compete with countries like Qatar, and is already supplying markets in the Gulf Arab states. Jafar identified a unique combination of factors that have brought success to the United States, such as the trading prices of crude and gas, unrivaled pipeline infrastructure, and the depth of capital markets.
By Diane Munro
May 26, 2016
Iran is navigating a myriad of challenges in its efforts to restore oil production to pre-sanctions levels and attract foreign investment amid the worst downturn in oil markets in more than a decade. Iranian crude oil production has steadily increased since sanctions were lifted in mid-January, to 3.5 million barrels per day (mb/d) in April, up by 500,000 b/d since the start of the year. Plans to raise production to 4 mb/d by the end of the Iranian calendar year in March 2017 appear ambitious and even modest growth of a further 600,000 b/d by 2021, to 4.6 mb/d, may be out of reach given political, legal, and investment challenges.