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Opec says global oil industry needs $12.1trn investments

Haitham Al Ghais said that the chronic underinvestment needs to be rectified

The global oil industry will need investments worth $12.1 trillion between now and 2045 as energy demand grows, according to Opec secretary General Haitham Al Ghais.

“This equates to more than $500 billion each year,” he said, adding the oil industry alone will make up almost 29 percent of the world’s energy needs by 2045.

However, recent annual investments have significantly missed the target due to industry downturns, the Covid-19 pandemic and the increasing focus on environmental, social and governance issues.

“In our World Oil Outlook 2022, we forecast global energy demand to expand by 23 percent to 2045,” Al Ghais stated. “Meeting this growth, ensuring energy security and affordable access and lowering global emissions in line with the Paris Agreement requires all energies and unprecedented investment and collaboration.”

The Opec chief said that the “chronic underinvestment needs to be rectified. It is not about waiting for tomorrow; it is about making it happen today”.

He stated that Opec member countries are ready, willing and able to play a key role in helping provide energy to the world and reducing emissions.

“We are investing in upstream and downstream capacity. We are mobilising cleaner technologies and our vast pool of human expertise to help decarbonise the industry. We are making major investments in renewables and hydrogen capacity, carbon capture utilisation and storage and other technologies, as well as promoting the circular carbon economy to improve overall environmental performance.”

The overall focus needs to be on emissions reduction and the use of all fuels worldwide, Al Ghais said, indicating “there is no one-size-fits-all solution to a sustainable energy future”. 

Emphasising the importance of ensuring a multilateral approach, he said that Opec “fully supports a global, multilateral approach, with collaboration at the fore”.

“We look forward to this year’s Cop28 in the UAE – an Opec member – and its championing an inclusive agenda, with the event undertaking a first global stocktake since the Paris Agreement.

“We hope the future sees investments and finance in the energy transition focusing on an ‘all peoples, all fuels and all technologies’ approach,” he said.