Saudi Aramco, the world's biggest state-owned oil company, said a further drop in crude oil prices may curtail investments needed to offset declining output in aging fields, TehranTimes reported with reference to Bloomberg.
Investment is also needed to expand production capacity to meet long-term demand growth, Chief Executive Officer Abdallah Jum'ah said in a handout distributed on Saturday at an industry summit in Beijing.
Benchmark crude prices in New York have declined 58 percent since reaching a record $147.27 a barrel in July, because of concerns a slowing world economy will erode demand. The world will need to invest more than $26 trillion, almost twice the annual domestic product of the U.S., by 2030 to ensure energy supply, the International Energy Agency said on Nov. 6.
"It is clear that collapsing oil prices are not only detrimental to the economies of oil-producing states but also to future upstream investments to sustain future oil demand consumption," Vienna-based consultant JBC Energy said in its weekly market report issued on Saturday.
Saudi Arabia, which has the world's largest proved reserves of oil, is implementing large-scale energy projects to boost production and refining capacity. The country has pledged to spend some $250 billion on energy by 2012, including raising oil output to 12.5 million barrels a day by next year, and increasing refining capacity by 50 percent.