The current energy crisis is a wake-up call for the need to invest more in the sector to avoid another energy supply crunch, Abu Dhabi National Oil Company (ADNOC) Chief Executive Sultan al-Jaber told an energy conference on Wednesday.
The oil minister of India, the world’s third biggest oil consumer and importer, echoed Jaber’s comments.
“Yes, a wake up call. That there is not enough investment. In addition to that is also the fact that the transition to green energy is also imposing a cost,” said the minister, Hardeep Singh Puri.
India is facing its worst power crisis in years and has been hit hard by rising oil prices, with local fuel prices surging to record high and its trade deficit ballooning to the highest in at least 14 years.
India imports 85 percent of its oil needs and buys most of this from the Middle East producers.
The UAE is investing boosting its oil and gas production, Jaber said, adding that ADNOC would remain a trusted oil supplier to India.
Puri said high energy prices are impacting global economic recovery, stoking inflation, and logistics costs. “If prices are not brought under control, global economic recovery could be fragile.”
Oil prices have to be predictable, dependable, and stable, Puri said, adding that high prices may also impact the producers in the long run.
India’s oil secretary Tarun Kapoor said: “OPEC can very easily raise production and gain confidence of consumers. If the sellers don’t come to help then the reliability goes away.”
Both Jaber and Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman said the world will continue to need fossil fuels despite the transition to cleaner energy sources.
Prince Abdulaziz said there was a lack of anticipation that the world economy would grow as fast as it is doing now.
“People all of a sudden woke up to the reality that they are running out of everything: they ran out of investments, they ran out of stocks and they ran out of … creativity in trying to be attending to real solutions that address real real issues,” Prince Abdulaziz told the CERA Week India Energy Forum.
OPEC Secretary General Mohammad Barkindo, also speaking at the forum, referred to surging energy prices and said not tackling energy affordability, energy security, and reducing emissions at once could lead to unintended consequences.
“We need a diversified energy mix, cleaner and more efficient technological solutions, and a stable, inclusive, just, and equitable energy transition,” he said. “The oil and gas industry can and must play a key role.”