Energy sector faces new challenges

2012-11-18 11:30
Oil rig (US Coast Guard, AP)

Oil rig (US Coast Guard, AP)

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London - A spike in shale oil and gas production is revolutionising the energy sector and risks weighing on prices of conventional crude, according to industry experts.

But although "the future is going to be technologically challenging" it will not be "more than it has been in the past," said Mike Daly, a senior executive at British energy group BP.

Daly said that industry spending on exploration was at $90bn a year compared with $20bn just five years ago, while more than half of current spending was on unearthing unconventional hydrocarbons such as shale oil and gas.

Julian Jessop, an analyst at Capital Economics research group, said the rise in shale products would impact Saudi Arabia, which is currently the world's biggest oil producer.

El-Badri also warned that persistent IEA forecasts that the United States would become the world's leading oil producer would lead to a drop in investment by other crude-producing countries.

Read more on:    saudi arabia  |  us  |  environment  |  renewable energy  |  fracking
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