Oil industry seeks to adjust to changing landscape

SINGAPORE (Reuters) – Oil’s race towards $70 a barrel in the last few months has stirred a debate on whether prices have run ahead of fundamentals, or if the market has bottomed and the time is now for a comeback in investments.

Near-term overcapacity, relatively lower oil prices and caution in committing to new large-scale refining and upstream projects have also prompted concerns of under-investment that will lead to future oil price spikes.

“The key issue facing the industry is trying to understand future demand and trying to balance that against investments,” Simon Littlewood, president of consultancy Asia Now, said.

These concerns, which run parallel to discussions on whether the global economy is emerging from the slump, and the changing landscape faced by oil companies, would be the focus of this year’s Asia Oil & Gas Conference (AOGC) in Kuala Lumpur next week.

Reuters