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Oil market to face lack of supply in 3 years: Total CEO
Speaking at 2016 Columbia Global Energy Summit, Pouyanne talked about the difficulties that oil companies are facing under low oil prices. "Fifteen days after I became the CEO of Total, oil prices collapsed ... and we lost $10 billion in cash flows in two months," he said. "Due to the huge drop in oil prices, most of the players had to squeeze their cash flows and investments," he added. Because of oversupply and low global demand, oil prices fell from $115 a barrel in June 2014 to below $30 a barrel in January 2016, marking a 75 percent decline.
"Because of less investment in shale oil and in major fields around the world, we will see a supply level this year ... In this industry, if you don't invest, you will have a natural decline in production," he added. "In the oil business, only two major projects were sanctioned worldwide in 2015 -- one in Norway and one in the U.S.' Gulf of Mexico. It's clearly insufficient ... We will not see immediate impact now of these expenditure cuts, but in 3 or 4 years we will see their impact," he explained. Posted by: Fred 2016-04-29 |
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