Shell CEO Sees Decade-Long Oil Price Surge Due to Structural Shift
Shell's CEO Wael Sawan has made headlines by stating that oil prices will trend higher over the next decade. According to Sawan, this is due to a structural shift in the energy industry where global conventional shallow-water reserves are depleting and remaining recoverable resources are increasingly concentrated in deepwater, polar regions, and complex geological settings.
In an interview earlier this year, Sawan explained that only higher prices can make these resources economically viable. He stated that oil prices will trend higher over the next 5 to 10 years due to this fundamental driver of a rising oil price floor.
Shell is responding to this long-term trend by streamlining non-core operations and sharpening its focus on upstream oil and gas operations, as well as liquefied natural gas (LNG). The company aims to deliver 1 million barrels of oil equivalent per day in new production by 2030 while expanding LNG sales volume at a compound annual growth rate of 4% to 5%
Recent developments, such as Shell's agreements with Venezuela and its potential oil discovery offshore Egypt, indicate that the company is advancing steadily according to its stated strategy.