With the oil price relatively low, the whole industry still faces challenges. However, the surge of collaboration and optimization, in tandem with a general belief that an upturn is coming in 2018, gives the subsea sector some cause for cautious optimism, delegates were told at last week’s Subsea North East Conference & Exhibition in Newcastle, England.
Malcolm Dickson, research director for Europe upstream at Wood Mackenzie, told delegates at the NOF Energy–organized event that he forecast a price range of $50-$53/bbl for the next two to three years.
“Toward the end of the decade we see oil prices rising but until then, we see prices at around $50-$53 per barrel for the next couple of years,” he said.
If that had been the case during the industry boom prior to mid-2014, then doom and gloom would be the outlook. But following the price crash, both operators and contractors, as well as the supply chain, had to work together to streamline processes and slash costs.
This major challenge has been accepted by nearly all players and the positive results mean projects are finally starting to reach sanction—with final investment decisions (FIDs) on the rise this year compared to last.