The market for oil and gas is expected to boom through 2022 and potentially beyond despite emerging strains of the novel coronavirus and the anticipated timeline for peak production of hydrocarbons being continuously pushed forth, the drilling services firm Baker Hughes said on Wednesday
WASHINGTON (Pakistan Point News / Sputnik - 08th September, 2021) The market for oil and gas is expected to boom through 2022 and potentially beyond despite emerging strains of the novel coronavirus and the anticipated timeline for peak production of hydrocarbons being continuously pushed forth, the drilling services firm Baker Hughes said on Wednesday.
"Looking at the near to intermediate term, we see continued signs of a global economic recovery that should drive further demand growth for the traditional markets of oil and natural gas through 2022 and potentially beyond," Baker Hughes CEO Lorenzo Simonelli told an industry conference.
Simonelli said Baker Hughes remained "constructive" on the oil price environment, as demand recovered, and they maintained spending discipline.
"Although we recognize the growing risks presented by the variant strains of the COVID-19 virus, we expect oil demand to eventually return to pre-COVID levels in the coming years," he said.
Simonelli said the timeline for "peak oil" - defined by a petroleum extraction rate greater than at any time in history, after which it will continue to decline - was being continuously deferred due to environmental issues and progress in electric vehicles, or EV.
"Looking further out into the second half of this decade and beyond, questions remain around the exact timing of peak oil demand," he said. "With policy momentum building for carbon pricing, an acceleration in EV adoption, and the likely growth in other sources of energy consumption, the timeline for peak oil seems to be consistently getting pulled forward."
Sionelli also said a combination of outages and strong demand in Asia, Latin America and Europe have driven third quarter LNG prices to levels not seen since 2015.
"Importantly, higher natural gas and LNG prices are beginning to support an increased level of long-term contracting activity as buyers once again seek out long-term supply agreements," he said.
Natural gas prices are up 93 percent on the year, trading near $5 per million metric British thermal units, after rallying with few stops since January due to weather extremities and underwhelming production. Crude oil prices are up around 40 percent, responding to output cuts by producer alliance OPEC+ and demand recovery.
