Over two-thirds of North Sea oil firms have been forced to scrap projects due to plummeting oil prices over the past year, a new report reveals today.
Although the price of benchmark Brent crude has rallied in the last few days, trading yesterday at around $66 a barrel, it has yet to approach the level it was at this time last year, at around $110. In the period between July 2014 and early 2015, that price more-than halved.
The report from Aberdeen Chamber of Commerce and Bond Dickinson notes this plunge in price has led to the “bittersweet positive” of an uptick in decommissioning projects in the North Sea.
Meanwhile, BP issued a dire warning over energy consumption growth, which it said “decelerated markedly” last year. Chief executive Bob Dudley said the events of 2014 may come to be seen as signs of “a broader shifting of the tectonic plates that make up the energy landscape”.
BP pointed to the US taking over Saudi Arabia as the world’s largest oil producer, as shale business booms. Saudi has chosen to maintain high output, despite competition from the US, and may be vindicated in this approach as US crude stocks suffered their biggest weekly decline last week sine July 2015.