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BP expects demand for oil to peak in late 2030s

21 May 2018 13:04 (UTC +04:00)

BP expects demand for oil to peak in the late 2030s, after which it will plateau and gradually decline.

‘While oil prices in recent weeks have hit their highest levels since late 2014 at $80 a barrel, BP are working on an assumption that prices will remain at a range of $50-$65 per barrel due to surging U.S. shale output and OPEC’s ability to crank up output’, BP Chief Executive Officer Bob Dudley told Reuters in an interview.

Mega projects involving complex, multi-billion facilities such as huge offshore platforms that came to symbolize the technological prowess of the world’s top oil companies are most likely a thing of the past, Dudley said.

Instead, BP is opting for phased developments that require less capital and less time to construct, which make them easier to control at a time of uncertainty over oil prices.

BP’s oil and gas output is set to reach around 4 million bpd by the end of the decade, a level last seen in 2009, with more than a fifth of that coming from projects started since 2016.

It is partnering with top oil producing nations which have some of the lowest costs of extraction such as Oman, Azerbaijan and most importantly Russia, where BP has a 19.75 percent stake in Rosneft and where it draws one third of its production.