Geopolitics, including the threat of war in the Middle East and on the Korean Peninsula, will replace oil supply cuts by OPEC and non-OPEC countries as the biggest driver of crude prices in the coming year, according to two-thirds of those polled in a Gulf Intelligence GIQ Survey.
In the aftermath of oil prices crashing below $30 a barrel in early 2016, the Organization of Petroleum Exporting Countries and 12 non-OPEC states finally agreed to slash total production by 1.8 million barrels a day in 2017, and in subsequent pacts committed to extend the cutbacks right through until the end of 2018. These actions successfully propelled Brent crude to soar and average above $50 a barrel last year.
Brent crude is expected to rise again in 2018 to average in the $60s-a-barrel range, according to a majority of the 100 Gulf energy industry executives polled ahead of their attendance at the annual UAE Energy Forum hosted by New York University Abu Dhabi on 11 January 2018.
“Let us be honest: 2018 does not feel good. Yes, markets are soaring, and the economy is not bad, but citizens are divided. Governments are not doing much governing. And the global order is unravelling,” Ian Bremmer, president, EURASIA Group, said in the think tank’s annual report on the top political risks facing the world.
“In the 20 years since we started Eurasia Group, the global environment has had its ups and downs. But if we had to pick one year for a big unexpected crisis – the geopolitical equivalent of the 2008 financial meltdown – it feels like 2018. Sorry,” Bremmer said in the 2 January report.
The New Year was not yet a day old when North Korea's leader Kim Jong-un came on the television to tell the world he had a nuclear launch button always on his desk – he declared the entire US was within the range of North Korean nuclear weapons, adding: "This is reality, not a threat!" Not to be undone, President Trump did not waste anytime sending his first tweet of 2018, a condemnation of Pakistan, a long-standing ally, for lying and deceit.
“It may indeed turn out to be the year of who needs enemies when you have got friends like this,” said Sean Evers, managing partner, Gulf Intelligence.
The UAE Energy Forum will host the world’s first feature interview with HE Suhail Al Mazrouei, the UAE minister of energy and industry, since taking up his position as president of OPEC on 1 January 2018.
The Forum will also bring the national energy industry together with their international partners to exchange knowledge and intelligence on the most pressing issues facing the global industry in 2018, along with partners including ADNOC, UNIPER, Total, OMV, Mubadala Petroleum and Sharjah National Oil Corporation. This year CNBC, The National, Thomson Reuters, Amwal and Al Watan Al Arabi are the media partners at the forum.