Energy industry leaders from the region converged on the second annual APICORP 2013 Symposium today in Kuwait to discuss the outlook for oil and gas markets in the Middle East and North Africa (MENA) over the next few years. Organized by the Arab Petroleum Investments Corporation (APICORP), the Multilateral Development Bank owned by the ten member nations of the Organization of Arab Petroleum Exporting Countries (OAPEC), the Symposium discussed market trends and challenges faced by the industry against the background of ongoing political turmoil in parts of the region; the expanding global map of oil and gas resources; and the vulnerabilities created by the rapid growth of domestic energy markets. The government of Bahrain owns a 3% stake in APICORP.
Ahmad Bin Hamad Al Nuaimi, Chief Executive and General Manager of APICORP said: “The APICORP 2013 Symposium was a perfect platform to discuss the global shifts taking place in energy supply and demand and the impact they are having on the region’s oil and gas industries. The event also offered an opportunity to discuss the confluence of several new trends we are seeing in the industry stretching across resources, policy, economic growth and security.”
“As a dynamic oil and gas hub, Kuwait provided the ideal setting to share ideas, aspirations, and generate solutions for the industry’s challenges. One of the largest shareholders of APICORP with a 17% stake, Kuwait has been a supporter of APICORP’s mandate and growth initiatives. It was in Kuwait almost four decades ago that APICORP was established and announced following an agreement signed by the ten member states of the Organization of Arab Petroleum Exporting Countries. We believe Kuwait’s ambitious plans to develop into the ‘oil and gas capital of the world’ has many potential synergies with APICORP’s mandate and strategy, which is focused on supporting the development of the Arab hydrocarbon and petrochemical industries and promoting cooperation and economic integration in the regional industry.”
The main speakers at the Symposium addressed three critical themes: Oil Markets and Prices: Current Trends and Future Outlook; Shale Oil: Expected Developments and their Implications; and MENA Natural Gas: Growing Shortfall and the Issue of Domestic Pricing.
Dr. Roberto M. Sieber, Chief Economist and Global Head, Market Analysis at Hess Energy Trading Company (HETCO) provided his medium-term outlook on the global oil market, with particular focus on the impact of the North American unconventional energy revolution on global oil supply and demand. He analysed the gap between market expectations and reality in the past and shared his views on the economy, oil consumption, the price range for international oil and changes in the refining industry and their implications for trade flows.
Dr. Bassam Fattouh Director Oil and Middle East Program, Oxford Institute for Energy Studies took the analysis of the US shale oil revolution a step further by assessing its implications for Middle East producers. He also provided insights on the drivers of the shale revolution and outlined two possible scenarios of its impact on oil supply dynamics and trade flows. Dr. Fattouh also discussed the impact of the US oil supply shock on the Middle East’s key producers.
Dr. Hakim Darbouche, Commercial Adviser, OMV Exploration & Production focused on the factors shaping domestic gas pricing policies in MENA. Driven in large part by artificially-low domestic prices, demand for natural gas in most countries of the region has grown faster than supply since the early 2000s, he said. The resulting gas deficit and pricing policy issues can no longer be ignored. Dr. Darbouche argued that unless current prices are adjusted to reflect new regional gas market realities, the MENA region will increasingly become an import centre rather than a major source of new supply.
This is the second year that APICORP is holding its Symposium. The inaugural Symposium held in Bahrain last year explored the impact of the shifting global economic environment and the changing political and energy landscape in MENA on the region’s energy investment outlook.