In this interview given on Al Arabiya’s flagship programme ‘The Future of Energy’ presented by Mr Naser Al Tibi, Dr Carole Nakhle, CEO of Crystol Energy, commented on the oil market outlook, including the potential outcome of OPEC+ meeting, peak oil demand scenarios and the role of oil and gas companies in the energy transition.
According to Dr Nakhle, there is a wide range of expectations from market observers about the outcome of the OPEC+ meeting – mostly predicting a relaxation of between 500,000 barrels per day to 1.5 million barrels a day. Such a wide variation in estimates and the change in OPEC+ policy – from setting a clear schedule covering several months or even years only a year ago (see April 2020 deal) to last minute decisions, which are surprising even some OPEC+ members – reflect the high level of uncertainty still prevailing in oil markets.
On the scenarios of peak oil demand, COVID-19 may have accelerated talks, but forecasts remain as divergent and uncertain as pre-pandemic. In one instance, there is more than 60 million barrels a day difference between one scenario and the other. The answer: no one really knows. Demand remains less understood than supply.
Dr Nakhle further discussed the industry’s outlook. Oil and gas companies play an important role in the energy transition as they provide the oil and gas that the world will still need for decades to come. They also have the capital to fund greener projects and reduce the impact of oil and gas on the environment. They have the infrastructure that can be used for greener energy sources and a much less talked about point, they contribute financially to the energy transition through the taxes they pay to various host governments.