Oil consumption is anticipated to surpass pre-pandemic levels by the end of 2022, with continued rise in 2023 and beyond, stated Schlumberger.
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FREMONT, CA: Schlumberger Ltd. CEO Olivier Le Peuch said on 21 January, 2022, that a solid recovery in global energy demand, combined with tighter natural gas and oil supplies, is generating ideal conditions for activity in the coming year. During a conference call, the world's largest oilfield services (OFS) company detailed the firm’s impressive fourth-quarter performance, along with Le Peuch detailing the view and outlook for 2022.
During the call, Le Peuch informed investors that the macro climate is becoming supportive of a potential supercycle, with market growth extending both onshore and offshore far beyond 2022. According to the company, there is an increase in confidence in the view of robust, multi-year market growth, tight oil supply, and demand growth beyond the pre-pandemic peak. Further, a substantial step-up in capital spending by exploration and production (E&P) customers will result in shrinking spare capacity and supportive commodity prices.
The CEO stated that in addition to technology usage rises and service capacity tightening, they predict further widespread service pricing improvements in response to market conditions. According to Schlumberger, oil consumption will surpass pre-pandemic levels by the end of 2022, with continued rise in 2023 and beyond. Long-cycle developments, such as those in the offshore, where projects might take years, are also projected to boost E&P capital expenditure (capex) growth.
Looking ahead to 2022, they anticipate a capex growth of at least 20 percent in North America, affecting both onshore and offshore sectors, while capital spending is expected to rise in the low to mid teens globally. Beginning in April, there will be a significant seasonal rise in 2022 across all divisions, stated Le Peuch. He further suggested that resurgent global demand-led capital spending will result in an exceptional multi-year growth cycle owing to positive market conditions that are straightly comparable to those experienced during the past industrial supercycle.