Latest news with #HaithamAlGhais
Forbes
06-05-2025
- Business
- Forbes
Saudi Arabia Rekindles Oil Price War: Another Epic Miscalculation?
Haitham al-Ghais, secretary-general of Organization of Petroleum Exporting Countries (OPEC), during ... More the India Energy Week conference in New Delhi, India, on Tuesday, Feb. 11, 2025. The conference runs through Feb. 14. Photographer: Anindito Mukherjee/Bloomberg © 2025 Bloomberg Finance LP Saudi Arabia is again making news in the oil markets. In a move reminiscent of the disastrous price war of 2015-2016 (see OPEC's Trillion Dollar Miscalculation), the kingdom has decided to boost oil production in a market that is already adequately supplied. The goal is to reclaim lost market share from non-OPEC producers and send a clear message to fellow OPEC members who haven't been sticking to the script. The increase will add 411,000 barrels per day (bpd) to global supply in June, and marks the third monthly hike in a row. That's on top of the 487,000 bpd added in April and May, for a total second-quarter boost of 960,000 bpd. Reuters reports this amounts to reversing about 44% of the 2.2 million bpd in voluntary cuts that were introduced when demand cratered during the COVID-19 pandemic. Jorge Leon of Rystad Energy told Bloomberg, "OPEC+ has just thrown a bombshell to the oil market. With this move, Saudi Arabia is seeking to punish lack of compliance and also ingratiate itself with President Trump. the market at a time when demand growth is tepid and global inventories are still relatively high, Saudi Arabia is betting that it can force higher-cost producers, especially in the U.S., to back off. The last time Saudi Arabia tried this, the fallout was severe. U.S. shale companies—flush with capital and optimism—were pushed into a financial meat grinder when oil prices plunged. Dozens of firms filed for bankruptcy, investors were burned, and the U.S. rig count cratered. Could it happen again? With West Texas Intermediate (WTI) now hovering below $60 a barrel, that extra supply couldn't come at a worse time for many U.S. producers. While shale operators have become more efficient and financially disciplined since the last downturn, many are still skating close to breakeven—especially those drilling outside the sweet spots of the Permian Basin. Breakeven prices vary, but they remain the single most important metric for understanding who's safe—and who's skating on thin ice: Permian Basin : New wells generally break even around $62 per barrel. Once operational, however, ongoing costs fall dramatically, with some wells profitable even at $38. : New wells generally break even around $62 per barrel. Once operational, however, ongoing costs fall dramatically, with some wells profitable even at $38. Delaware Basin : Breakeven sits closer to $56 per barrel. : Breakeven sits closer to $56 per barrel. Midland Basin and Eagle Ford: These regions face higher break-even prices, around $66 per barrel on average. A combination of inflation, supply chain issues, and tariffs has driven costs higher across the board. Steel and sand cost more, and those cost pressures are eroding margins. What This Means for Investors This brewing price war isn't just a geopolitical chess match—it has direct implications for portfolios. Here are four key takeaways: 1. Margin Strength Matters Producers operating in the lowest-cost regions are best positioned to ride out the storm. Investors should focus on companies with low breakevens, strong balance sheets, and disciplined capital spending. 2. Production Will Respond As prices dip below breakeven, drilling slows. That reduction in U.S. supply could help stabilize prices over time, but the near-term pain will be real—especially for smaller, less efficient operators. 3. Services Sector Could Suffer When E&Ps pull back, oilfield services feel it first. Companies like Halliburton and Schlumberger rely heavily on shale activity. If rig counts fall, so will revenues. That said, select service providers with exposure to the Permian's core may still find opportunities. 4. Hedging Is a Lifeline Some producers have locked in prices through hedging, insulating themselves—at least temporarily—from market volatility. Investors should keep a close eye on hedging strategies to understand which companies are less likely to be impacted by a prolonged price downturn. A Balancing Act in a Volatile Market Saudi Arabia's gamble could put downward pressure on global prices in the short term—but it may also sow the seeds for another rebalancing. Lower prices will force marginal players to the sidelines, eventually tightening supply. But for now, the pressure is squarely on U.S. producers to either endure another round of low prices—or scale back once again. For investors, the message is clear: pay attention to break even prices, watch for signs of capitulation in high-cost basins, and look for companies that can survive—and even thrive—at $60 oil or less.
Zawya
12-02-2025
- Business
- Zawya
Oil sector needs $640bln annual investment: OPEC chief
The oil sector will need substantial investments to reliably meet the expected growth in demand, with cumulative investment requirements estimated at $17.4 trillion between 2024 and 2050, or approximately $640 billion annually, said Haitham Al Ghais, Secretary-General of OPEC. In statements to the Emirates News Agency (WAM) during the World Governments Summit (WGS) 2025, Al Ghais highlighted that the exploration and production sectors will absorb the largest share of investments in the oil sector, with total investment needs in these areas estimated at $14.2 trillion, or around $525 billion annually. Additionally, investment needs in refining, manufacturing, transportation, and storage are expected to reach approximately $1.9 trillion and $1.3 trillion, respectively, over the same period. He explained that OPEC's priorities include supporting and ensuring global oil market stability to secure reliable, cost-effective, and regular petroleum supplies for consumers, a steady income for producers, and a fair return on capital for investors in the petroleum industry. The Secretary-General emphasised OPEC's commitment to securing the future of energy across all types and sources to address energy poverty and promote prosperity for inclusive economic growth under the "all-peoples, all-fuels and all-technologies" approach. Al Ghais noted that these goals are essential for developing the economies of many countries, particularly developing nations that are the main drivers of oil demand. To achieve these objectives, investment in all types of energy, including the oil industry, must be encouraged. According to OPEC's World Oil Outlook (WOO) 2024, global oil demand is expected to exceed 120.1 million barrels per day by the end 2050, an increase of 18 million barrels per day from 2023. Due to population growth, urbanisation, and economic expansion, developing countries are expected to see oil demand growth of about 28 million barrels per day, while developed countries will experience a decline in demand by about 10 million barrels per day. Al Ghais pointed out that the global oil demand growth forecast for 2025 remains at 1.4 million barrels per day. Demand in OECD member countries is expected to grow by 0.1 million barrels per day, while non-OECD countries are expected to see a growth of 1.3 million barrels per day. Regarding OPEC's role in maintaining global oil market stability, Al Ghais said the organisation has long recognised the importance of dialogue between producers and consumers in all areas of energy. He added that key international issues related to energy, such as market stability, supply and demand security, economic prospects, and environmental concerns, directly impact the balance of global energy markets, particularly the oil and gas industry. Proactive dialogue is essential to align the views of all stakeholders. Copyright 2024 Al Hilal Publishing and Marketing Group Provided by SyndiGate Media Inc. (
ARN News Center
12-02-2025
- Business
- ARN News Center
$640 bn needed annually to meet oil demand growth, says OPEC
Haitham Al Ghais, Secretary-General of OPEC, said investment needs in the oil sector will remain substantial to meet the expected growth in oil demand, with cumulative investment requirements estimated at $17.4 trillion between 2024 and 2050, or approximately $640 billion annually. In statements to the Emirates News Agency (WAM) during the World Governments Summit (WGS) 2025, Al Ghais highlighted that the exploration and production sectors will absorb the largest share of investments in the oil sector, with total investment needs in these areas estimated at $14.2 trillion, or around $525 billion annually. Additionally, investment needs in refining, manufacturing, transportation, and storage are expected to reach approximately $1.9 trillion and $1.3 trillion, respectively, over the same period. He explained that OPEC's priorities include supporting and ensuring global oil market stability to secure reliable, cost-effective, and regular petroleum supplies for consumers, a steady income for producers, and a fair return on capital for investors in the petroleum industry. The Secretary-General emphasised OPEC's commitment to securing the future of energy across all types and sources to address energy poverty and promote prosperity for inclusive economic growth under the "all-peoples, all-fuels and all-technologies" approach. Al Ghais noted that these goals are essential for developing the economies of many countries, particularly developing nations that are the main drivers of oil demand. To achieve these objectives, investment in all types of energy, including the oil industry, must be encouraged. According to OPEC's World Oil Outlook (WOO) 2024, global oil demand is expected to exceed 120.1 million barrels per day by the end 2050, an increase of 18 million barrels per day from 2023. Due to population growth, urbanisation, and economic expansion, developing countries are expected to see oil demand growth of about 28 million barrels per day, while developed countries will experience a decline in demand by about 10 million barrels per day. Al Ghais pointed out that the global oil demand growth forecast for 2025 remains at 1.4 million barrels per day. Demand in OECD member countries is expected to grow by 0.1 million barrels per day, while non-OECD countries are expected to see a growth of 1.3 million barrels per day. Regarding OPEC's role in maintaining global oil market stability, Al Ghais said the organisation has long recognised the importance of dialogue between producers and consumers in all areas of energy. He added that key international issues related to energy, such as market stability, supply and demand security, economic prospects, and environmental concerns, directly impact the balance of global energy markets, particularly the oil and gas industry. Proactive dialogue is essential to align the views of all stakeholders.
Trade Arabia
11-02-2025
- Business
- Trade Arabia
Oil sector needs $640bn annual investment: Opec chief
The oil sector will need substantial investments to reliably meet the expected growth in demand, with cumulative investment requirements estimated at $17.4 trillion between 2024 and 2050, or approximately $640 billion annually, said Haitham Al Ghais, Secretary-General of OPEC. In statements to the Emirates News Agency (WAM) during the World Governments Summit (WGS) 2025, Al Ghais highlighted that the exploration and production sectors will absorb the largest share of investments in the oil sector, with total investment needs in these areas estimated at $14.2 trillion, or around $525 billion annually. Additionally, investment needs in refining, manufacturing, transportation, and storage are expected to reach approximately $1.9 trillion and $1.3 trillion, respectively, over the same period. He explained that OPEC's priorities include supporting and ensuring global oil market stability to secure reliable, cost-effective, and regular petroleum supplies for consumers, a steady income for producers, and a fair return on capital for investors in the petroleum industry. The Secretary-General emphasised OPEC's commitment to securing the future of energy across all types and sources to address energy poverty and promote prosperity for inclusive economic growth under the "all-peoples, all-fuels and all-technologies" approach. Al Ghais noted that these goals are essential for developing the economies of many countries, particularly developing nations that are the main drivers of oil demand. To achieve these objectives, investment in all types of energy, including the oil industry, must be encouraged. According to OPEC's World Oil Outlook (WOO) 2024, global oil demand is expected to exceed 120.1 million barrels per day by the end 2050, an increase of 18 million barrels per day from 2023. Due to population growth, urbanisation, and economic expansion, developing countries are expected to see oil demand growth of about 28 million barrels per day, while developed countries will experience a decline in demand by about 10 million barrels per day. Al Ghais pointed out that the global oil demand growth forecast for 2025 remains at 1.4 million barrels per day. Demand in OECD member countries is expected to grow by 0.1 million barrels per day, while non-OECD countries are expected to see a growth of 1.3 million barrels per day. Regarding OPEC's role in maintaining global oil market stability, Al Ghais said the organisation has long recognised the importance of dialogue between producers and consumers in all areas of energy. He added that key international issues related to energy, such as market stability, supply and demand security, economic prospects, and environmental concerns, directly impact the balance of global energy markets, particularly the oil and gas industry. Proactive dialogue is essential to align the views of all stakeholders.
Dubai Eye
11-02-2025
- Business
- Dubai Eye
$640 bn needed annually to meet oil demand growth, says OPEC
Haitham Al Ghais, Secretary-General of OPEC, said investment needs in the oil sector will remain substantial to meet the expected growth in oil demand, with cumulative investment requirements estimated at $17.4 trillion between 2024 and 2050, or approximately $640 billion annually. In statements to the Emirates News Agency (WAM) during the World Governments Summit (WGS) 2025, Al Ghais highlighted that the exploration and production sectors will absorb the largest share of investments in the oil sector, with total investment needs in these areas estimated at $14.2 trillion, or around $525 billion annually. Additionally, investment needs in refining, manufacturing, transportation, and storage are expected to reach approximately $1.9 trillion and $1.3 trillion, respectively, over the same period. He explained that OPEC's priorities include supporting and ensuring global oil market stability to secure reliable, cost-effective, and regular petroleum supplies for consumers, a steady income for producers, and a fair return on capital for investors in the petroleum industry. The Secretary-General emphasised OPEC's commitment to securing the future of energy across all types and sources to address energy poverty and promote prosperity for inclusive economic growth under the "all-peoples, all-fuels and all-technologies" approach. Al Ghais noted that these goals are essential for developing the economies of many countries, particularly developing nations that are the main drivers of oil demand. To achieve these objectives, investment in all types of energy, including the oil industry, must be encouraged. According to OPEC's World Oil Outlook (WOO) 2024, global oil demand is expected to exceed 120.1 million barrels per day by the end 2050, an increase of 18 million barrels per day from 2023. Due to population growth, urbanisation, and economic expansion, developing countries are expected to see oil demand growth of about 28 million barrels per day, while developed countries will experience a decline in demand by about 10 million barrels per day. Al Ghais pointed out that the global oil demand growth forecast for 2025 remains at 1.4 million barrels per day. Demand in OECD member countries is expected to grow by 0.1 million barrels per day, while non-OECD countries are expected to see a growth of 1.3 million barrels per day. Regarding OPEC's role in maintaining global oil market stability, Al Ghais said the organisation has long recognised the importance of dialogue between producers and consumers in all areas of energy. He added that key international issues related to energy, such as market stability, supply and demand security, economic prospects, and environmental concerns, directly impact the balance of global energy markets, particularly the oil and gas industry. Proactive dialogue is essential to align the views of all stakeholders.
