March 2 2015
Bassam Fattouh (Oxford Institute for Energy Studies)
Edward Lucas (The Economist)
It has been a roller-coaster ride for oil markets over the last few years – with prices hitting a high of US$150/barrel and then collapsing below US$50. Maybe, we have found a bottom, at last. But there are also structural changes in the industry that are likely to ensure that the future doesn’t just repeat the post-1973 past. In particular:
- OPEC is changing, with Saudi Arabia increasingly disinclined to act as the global swing producer;
- the advent of “tight” oil – shale oil, in particular – means that North American oil production is now at a record, and that it is not unlikely that the US could become a net oil exporter in the not-too-distant future; and
- technology is breaking the link between economic growth and energy consumption – with ever greater energy efficiency, particularly in the automobile sector.
On the other hand, political (and/or politico-religious) disruption is making it harder for energy consumers to count on conventional oil producers in North and West Africa, in large parts of the Middle East and in Venezuela.
And then, of course, there is the Holy Grail/mirage of endless solar power, or wind power, or tidal power. Or even biomass.
One could go on, but the important point is that oil and energy still go hand-in-hand, and – whether we like it or not – economic growth will remain dependent on oil for at least the next couple of decades. Hence the importance of this round-table, which gives us an opportunity to hear what two of this country’s leading energy commentators have to say:
- Bassam Fattouh is both the director of the Oxford Institute for Energy Studies and a professor at SOAS (from which he obtained his PhD). He has written widely on oil pricing and on the security of oil supplies, as well as on banking and finance more generally.
- Edward Lucas is the energy, commodities and natural resources editor at The Economist, where he has worked for two decades – specialising primarily in Central and Eastern Europe. His 2008 book on The New Cold War has just been republished in a third edition.
These are heady times for the energy industry, and we are delighted that Bassam and Edward have agreed to share their thinking/concerns with us.