News Detail

Key points: 

. $11.1 trillion is needed for oil exploration by 2045, says OPEC.

. Investment is key for stable energy supplies.

. OPEC criticizes IEA's call against new oil investments.

. OPEC raised the oil demand forecast for 2045.

. Moving away from oil too quickly could hurt economies.

Haitham Al Ghais, Secretary General of the Organisation of the Petroleum Exporting Countries (OPEC), states that for the oil sector to meet the world's growing energy demands by 2045, an astounding $11.1 trillion would need to be invested in exploration and production (upstream) operations.

Al Ghais underlined the need for ongoing investment in oil production in an interview with the Emirati news agency WAM. According to him, making these kinds of investments is essential to guaranteeing "stable supply, promoting the sustainability of the global energy sector, and securing sufficient and reliable supplies for the world as a whole, as well as ensuring secure supplies for future generations."

This position is consistent with the longer-term objectives of OPEC. In October 2023, they published their most recent World Oil Outlook, which states that by 2045, $14 trillion should be invested in the oil industry's upstream, middle, and downstream segments. This corresponds to an annual average investment of around $610 billion, most of which is allocated to upstream activities.

OPEC has been outspoken in its condemnation of those urging a suspension of any investments in oil production. They attacked the International Energy Agency (IEA) in November 2023, claiming it demonised the oil sector while ignoring energy security and cost issues. Conversely, the IEA has already pushed the industry to decide between contributing to climate change and joining the solution.

Also read: Record-Breaking Year for Oil Consumption? Industry Anticipates Continued Growth

Al Ghais also reaffirmed OPEC's faith in its long-term oil demand projection, which was considerably updated in October 2023. The cartel has revised its global oil consumption forecast, estimating it will reach about 116 million barrels per day (bpd) in 2045, a significant rise of 6 million bpd over its 2022 prediction.

Al Ghais recently wrote a piece outlining the possible repercussions of a sudden move away from oil. He foresaw massive job losses, dwindling tax collections, stifled industrial output, and an overall economic downturn. In closing, he emphasised the importance of a balanced stance: "We need to be cautious of endangering the present, in the name of saving the future."

Stay informed with BSO

At BSO, we aim to keep you updated on industry insights and trends like this so you can make informed decisions for your business.