Oil investment falls

oilOil.Photo: pixabay.com

Oil companies are tightening and investment in the industry continues fall. These figures from Statistics Norway (SSB) were announced Wednesday.

Figures from Statistics Norway show the industry’s own estimate for how much they will invest in the future.

Investments for 2016 in the extraction of oil and gas and pipeline transportation are estimated at 163.5 billion crowns, which 1.5 percent lower than in the last survey.

The estimate for 2016 is 17.5 percent lower than the corresponding estimate for 2015 given in the third quarter last year.

The reduction is primarily in field development and asset retirement obligations.

Chief Analyst Erik Bruce of Nordea Markets, does not see the numbers as dramatic.

– Now we indicate a decline in oil investment of 8 percent next year and 16 percent this year. It’s a bit on the weak side, but it is not a dramatic change in their view of the future, he said to E24.

He believes the worst is now behind us.

– Investments have falling year by year more last year than this year,  it will be less next year, said Bruce.

Chief economist Kyrre Knudsen in Sparebank 1 SR-Bank, stressed that the estimate of SSB does not say anything about the number of wells drilled and the general activity on the shelf.

He also points out that the industry is in a sharp reduction of costs.

– The figures show a decline of about 8 percent. Prices also fell by 10.08 percent, the activity is unchanged. it is not as badas it sounds, he said.

Source: NTB scanpix / Norway Today