OPEC upstream investment: Middle East growth offsets African declines Report

Insight 23 July 2018

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Report summary

OPEC spare capacity continues to be a key lever to help balance the oil market. But this capability does not come for free. It takes large-scale, long-term investment to maintain. OPEC is not shying away from this obligation, and is projected to invest US$377 billion in its upstream oil sector over the next five years. The Middle East, with its vast onshore resources, will be the focus of this investment, offsetting declines across other OPEC nations. African members continue to struggle. For them the worst may be over, but the road to recovery is long.

Executive Summary
- OPEC investment: US$377 billion over the next five years
- The Middle East weathered the storm
- African investment collapsed and its recovery will be slow
- OPEC production: growth driven by the Middle East
- Middle East benefits from low-cost onshore production
- Africa relies on the Majors and will need to fight for investment dollars
- Investment leads to increased OPEC capacity