KUALA LUMPUR: Global oil prices are expected to remain stable in the second half of this year, driven by steady demand from oil refinery processors despite the booming shale oil production in the US, an industry expert said.
Credit Suisse global co-head, oil and gas equity research, David Hewitt, said the booming shale oil production in the US is not expected to push down global prices further from the current US$97 per barrel but instead stabilise the international market and ease threats of world supply shortages.
“We don’t see the fundamental effect of US shale production affecting the oil and gas outlook this year, and we think that Saudi Arabia will continue to be the world’s main producer,” he said at the 17th Asia Oil and Gas Conference 2013 here yesterday.
Hewitt was a panellist in a session on ‘Political and Economic Scenarios’ at the conference, which also featured US-based East-West Centre senior fellow Kim Yoon-Hyung and UK-based Wood Mackenzie chairman David Morrison.
US imports last year fell to the lowest level since 1997 after new technologies in drilling enabled petroleum companies to unlock a previously inaccessible bounty of shale oil, trapped beneath rock formations several thousands of feet deep, boosting the country’s crude oil production to a multi-decade high.
Hewitt said even though the US’ booming shale oil production would provide cheap oil to the country’s market, the impact beyond the borders is not likely the same as global demand for energy is rising in tandem with the emergence of the new economies in Asia as well as the rising global population.
Petronas chief operating officer and executive vice president of downstream business Datuk Wan Zulkiflee Wan Ariffin, the session’s moderator, said implementation of new technology would unlock areas previously deemed uneconomical and ease fears of depleting resources.
“At the same time, new sources of oil and gas have appeared all over the world, creating a comfortable long-term supply of oil and gas,” he said.
The two-day conference, themed ‘Our World, Our Energy, Our Destiny’, is attended by policy makers and the region’s top oil company executives. — Bernama