“Our prediction is an average price of USD 70 per barrel for 2019,” says Helge André Martinsen, Oil Analyst at DNB, Norway’s largest bank.
At the oil and energy conference in Kristiansand Tuesday, Martinsen said the ongoing energy transition is a challenge for the oil market.
“However, for Norway as an offshore oil producer, the threat from within the oil industry is much greater that the threat from alternative energy sources,” says Martinsen – and explained:
“Investments in renewables show no growth. Installed new renewable energy is not sufficient to satisfy the annual growth in global energy demand. Onshore oil production is a much greater threat to offshore oil production. US shale oil is what really alters the playing field,” says Martinsen.
He pointed out that US shale production annual growth is equivalent to the output of oil and gas from the entire Norwegian Continental Shelf.
“Ten years ago, shale was non-existent. Today, shale investments match offshore investments,” says Martinsen.
In 2018, offshore oil and gas investments represented 26 per cent of total oil and gas investments, down from 40 per cent in 2016.