But low prices will not affect long-term trajectory of oil and gas sector, says Deloitte
- Opec faces shift in supply-demand on US resurgence
- Opec could focus more on Western Europe market
- Emerging Middle East suppliers like Iraq could change dynamics
Opec could lost 5 per cent of its market share by 2018 as new trading patterns threaten its position, according to a new forecast by Deloitte Middle East.
The current phase of lower oil and gas prices is unlikely to affect the long-term trajectory of the sector in the Middle East, the firm added.
Opec currently supplies about 32 per cent of worlds crude oil but Deloitte forecast this to drop by 5 per cent by 2018 as the supply of US tight oil picks up. It added that Opec may recover lost share in the long term as supply patterns shift.
Deloitte identified six key trends impacting the Middle East oil and gas industry as the region deals with rising oil production and self-sufficiency in North America, but said prices would not have a direct impact on the emergence of these trends.
The oil and gas industry has been built on long-term investments and has successfully emerged from cyclical downturns in the past. As these trends play out, companies across the board need to adapt and remain agile to emerge a leaner, fitter business, says Salam Awawdeh, partners and energy & resources leader at Deloitte Middle East.
Opec will be seeking new buyers as North America increasingly meets its own demand and may aim to pick up market share in Western Europe the report says.
Global markets are also shifting their supply-demand fundamentals. For instance, while the Middle East can meet its current needs, demand for both oil and gas in the region is growing, says Awawdeh.
A number of emerging, and re-emerging major suppliers can also potentially change energy market dynamics. Output from Southern Iraq and Iraqi Kurdistan could ramp up, for example, despite the security issues that currently plague the region, he adds.
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