The latest of ADIPEC Energy Dialogue maintains that manufacturing is key to the mid-term revival of the oil and gas markets as consumer demand is expected to lag, according to a press release.
Speaking at ADIPEC Energy Dialogue, Rachel Ziemba, an economic and political risk expert and Founder of Ziemba Insights, used China as a yardstick for how other major economies will follow suit after exiting from the COVID-19 crisis. China’s manufacturing has so far shown greater signs of recovery when compared to levels of consumption.
“It is notable that the COVID-19 crisis and the associated economic and energy crisis has really been the first to blow out the global consumer,” Ziemba said, adding that “2008 was much more of a hit to the financial sector and manufacturing. This time it is the reverse. The big question is how quickly consumer demand will come back.” Addressing a potential recovery time-frame, Ziemba estimates that oil and gas markets could take until late 2021 to return to the end of 2019 levels.
Ziemba also discussed the Organization of the Petroleum Exporting Countries and its allies (OPEC+) supply constraints that are coming under pressure from US shale and indebted oil producers as prices strengthen, with the likely outcome of roll over of production cuts.
The ADIPEC Energy Dialogue is a series of weekly online thought leadership events created by dmg events, organizers of the annual Abu Dhabi International Exhibition and Conference.