Despite the Wall Street “meltdown” and the recent 60 percent drop in the price of oil, the demand for work boats, tugs, and offshore service vessels remains strong in the Arabian Gulf.
“The oil- and gas-producing states have not reduced their petroleum exploration and development activity at all,” Mr. Kishore Navani, manager of Baird Events, said.
Mr. Navani, who is organizing the forthcoming Work Boat Gulf 2009 event said, “We have had very strong interest in the event. This is not surprising as we learn almost daily of new vessels being ordered for or delivered to the Gulf.”
Confirming the Baird Events experience were recent comments from leading petroleum logistics analyst John Westwood of Douglas-Westwood, Ltd. of the UK.
Mr. Westwood said the growing Middle East region will itself need vast amounts of energy, and eventually oil supplies will be unable to meet demand, causing prices to rise dramatically. Westwood calmed fears of those dealing with the current economic conditions and falling oil prices, adding the “energy sector will remain very good as a long-term investment,” the key word being long-term.
On July 11 of this year, oil prices hit US$147/bbl, and today they are hovering around US$63/bbl. Westwood said the current situation was caused by “two decades of underinvestment,” and the oil and gas industry (both offshore and onshore) needs to spend $10 trillion by 2030 to get back on track.
“Global energy demand is up 37 percent since 1990,” Westwood said, “and across the world the demand for energy was met 35 percent by oil.”
In 2007, the average oil prices increased 58 percent, while companies’ oil reserves fell. Another interesting note – while prices increased, company revenues per barrel were the same as in 2006.
“The ‘easy oil’ has gone, and the remainder is in difficult places,” he said, adding that in the future there is going to be a time when the oilfield production decline cannot be replaced. Westwood predicted offshore oil and gas production and spending to grow. While deepwater production shows the fastest growth, shallow water, like the water in the Middle East, is the largest offshore market.
Baird Events is working closely with Saudi Aramco, the largest user of OSVs and work boats in the Gulf, on a major forum to be held alongside the Work Boat Gulf exhibition.
For further information on the Work Boat Gulf exhibition or the First Arabian Gulf Workboat Owners Association Forum, please contact: Kishore Navani, Baird Events, PH: +61 3 9645 0411, FX: +61 3 9645 0475, Email: [email protected], Web: www.baird-online.com .