OPEC, the International Energy Agency (IEA) and a host of Big Oil executives are sounding the alarm about a looming supply gap and potential price spike sometime after 2020. The reason: a sharp plunge in upstream investment in the years following the 2014 oil price collapse. After all, supply gap fears bolster oil prices, which boost the cartel’s revenues. Essentially, the global industry was spending more than $700 billion a year on upstream oil and gas projects before prices tanked in 2014. Project costs for BP’s Mad Dog 2 deepwater project in the U.S. Gulf fell from more than $20 billion to $9 billion.

Source: Forbes March 29, 2018 16:18 UTC