Adipec 2017: World headed for oil supply ‘bust’ due to lack of investment

Oil pipes connect the Monte Toledo oil tanker to an offshore pumping station as it delivers a shipment of Iranian oil to the Cia. Espanola de Petroleos SA (CEPSA) refinery near Algeciras, a few miles from Gibraltar. Photographer: Luke MacGregor/Bloomberg
Oil pipes connect the Monte Toledo oil tanker to an offshore pumping station as it delivers a shipment of Iranian oil to the Cia. Espanola de Petroleos SA (CEPSA) refinery near Algeciras, a few miles from Gibraltar. Photographer: Luke MacGregor/Bloomberg

The world is heading for a “bust” in oil and gas supply due to chronic levels of underinvestment in the sector during the downturn, industry chiefs said today.

David Dickson, chief executive of McDermott, said investment in the oil and gas industry was $1-2trillion below the required levels.

Mr Dickson said at Adipec:  “We can feel the effects of that under-investment already. I don’t know how we’re going to catch up with that.

“There is a bust coming somewhere ahead of us.”

He said resources were not being replaced at the same speed as they are being used.

“You do not need to be a scientist to know the equilibrium will be upset at some point,” he said.

Weatherford chief executive Mark McCollum said: “We are underinvesting for what is going to be a big demand shift.

“There’s going to be surge of activity we’re going to have to address.”

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