How Has the Coronavirus Pandemic Impacted Oil Producers and What Lies Ahead?

This session took place as part of AGSIW’s sixth annual Petro Diplomacy conference.

The post-coronavirus recovery may be long and painful as governments around the world grapple with the aftershocks of the pandemic. With projections from the International Energy Agency pointing to demand for oil declining by 7.9 million barrels per day in 2020, Middle East oil producers have cut production and adjusted their budgets. Similarly, U.S. shale production declined sharply earlier in the year, with only subdued production growth expected in 2021 despite a rebound following the OPEC+ agreement.

How will Arab oil producers – and the rentier state economies they support – respond to this substantial loss of revenue? What are the options available to mitigate the impact of a sharp decline in earnings? Will the crisis delay or speed up the effort to diversify Gulf economies and prepare for the possibility of a lower carbon future? What policy frameworks are emerging as the pandemic is brought under control? What role will the national oil companies play in the recovery effort and will they emerge from the crisis weaker or stronger? What impact has the price volatility and demand destruction had on U.S. shale oil production?

This program was convened by invitation only and conducted under the Chatham House Rule. If you are interested in being included in AGSIW’s exclusive events, please contact Raymond Karam, chief program and development officer: raymond.karam@agsiw.org.

The views represented herein are the author's or speaker's own and do not necessarily reflect the views of AGSI, its staff, or its board of directors.