At Bloomberg’s June 4 virtual event, Powering Forward: Crude Awakening, Bloomberg Television anchor Annemarie Hordern conducted a series of interviews with key global oil stakeholders. The event started with Tina Bru, Norway’s Minister of Petroleum and Energy, and was followed by a conversation with Fatih Birol, Executive Director, International Energy Agency. The event concluded with a discussion between Ben Luckock, Co-Head of Oil Trading, Trafigura and Scott Sheffield, President & CEO, Pioneer Natural Resources Company.
In case you missed it, below are some key insights from our conversation, but you can also view the entire event here.
Tina Bru, Norway’s Energy Minister, said that their ‘worst fears’ from the last few months concerning oil storage hitting maximum capacity had now been eased. This ‘stabilization’ has been brought about through the returning demand for oil, particularly as more people start travelling again. Bru said that Norway had already moved ahead with production cuts, something they had not done since 2002 following September 11, but did not anticipate further cuts at this time.
Fatih Birol, Executive Director, International Energy Agency, said it is ‘far too early’ to write shale oil’s obituary, even though investment year on year is set to decline 50%. We may see a recovery at $40-$45/bbl, he said. Birol also stated that the pace of any recovery depended on a return of demand to key sectors including petrochemicals and cars, which together makeup close to 50% of global oil consumption, and aviation, which makes up 7%. Birol also cautioned that a return of oil demand was dependent on government policies, particularly pertaining to schemes encouraging renewables in place of fossil fuel consumption.
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