Oil industry costs continue steep rise: CERA

NEW YORK (Reuters) – Costs to tap into new oil and gas projects escalated about 6 percent globally over the past 6 months and the climb can be expected to steepen on soaring prices for steel and other raw materials, according to a study released on Wednesday.

Cambridge Energy Research Associates (CERA), a unit of information and consultancy IHS Inc (IHS.N: Quote, Profile, Research), said that costs to build new refineries and petrochemical plants also rose 6 percent.


“So long as oil prices remain high and demand for the end products remain high, I think we’re going to see continued high level of costs,” Candida Scott, senior director of cost and technology at CERA, said in an interview.

“We’d really have to see a slackening of demand and oil prices coming down to see any reduction in costs.”

Reuters