Global oil supplies may be 6 percent less than expected by 2030 because of delays to investments by energy companies in response to falling crude prices due to the coronavirus crisis, data from energy analysts at Rystad showed.
Oil and gas companies across the world have slashed investment budgets, exiting projects or delaying bringing them onstream to counter a fall in crude prices to record lows due to a supply glut as the coronavirus outbreak destroyed demand.
Delayed final investment decisions (FID) for projects which take years to come on stream are already expected to shrink global supply of oil and gas by 5.6 percent by 2025, with the majority of the revisions coming from shale oil, mostly found in the United States, Rystad said.
Liquefied natural gas (LNG) projects are also suffering. “2020 was also set to be the record high year for LNG developments. The price crash and dip in global LNG demand delays FID of 7 LNG plants globally,” Rystad analysts said in their report.
Royal Dutch Shell even went so far as to completely exit its major Lake Charles LNG in the United States.