ROSNEFT REMINDED ABOUT THE REALITY TO THE FOLLOWERS OF THE LOW-CARBON POLICY

Alexei Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance, commented to the Internet portal "Economics Segodnya" on the statement of Igor Sechin, Chief Executive Officer of Rosneft, at SPIEF-2021 that the world may face an acute oil and gas shortage because of underinvestment in the industry.

The head of Rosneft Igor Sechin during his speech at SPIEF-2021, said that the world could face an acute shortage of oil and gas due to underinvestment in the industry.

“The 2020 crisis has led to the fact that companies in the oil industry around the world have postponed new investment projects with a total volume of about 5 million barrels per day for the coming years,” Alexey Gromov explains. “If we take a more distant horizon, then the total number of postponed projects exceeds the volume of potential production at the level of 10 million barrels per day.”

The situation is also affected by the "green" policy of the European Union, forcing companies and individual states to increase costs in terms of accelerated decarbonization in the form of taxes and other payments. Subsidies in the European Union for solar and wind power generation have already reached 50 billion euros.

“The low-carbon agenda that prevails in the global climate and energy policy leads to the fact that investor interest in the oil industry is gradually cooling down. It is becoming more and more difficult to attract funds for new oil and gas projects. There is a risk that the industry may face a shortage of supply in the next five to seven years,” Gromov emphasized.