A shortage of new discoveries and paltry investment could combine to reduce the global oil supply, Saudi Aramco's chief executive said Monday, July 10.
"Financial investors are shying away from making much needed large investments in oil exploration, long-term development and the related infrastructure," CEO Amin Nasser said, according to CNBC. "Investments in smaller increments such as shale oil will just not cut it."
The oil executive said that his company was continuing to invest in oil production capacity, including $300 billion of planned investments in the next decade. Aramco, the engine of Saudi Arabia's economy, is slated to have an IPO in the second half of 2018, though experts have warned that a sustained soft price environment for crude could dash those plans.
Last week, Florence Eid-Oakden, the CEO and chief economist for the research and strategy firm Arabia Monitor, told TheStreet that an IPO wouldn't make sense given current oil pricing. The price of oil will have to be "optimal," Eid-Oakden said, suggesting a price-per-barrel of around $60.
In recent months, the price of oil has been on a downward slide even amid production cuts for OPEC countries, as American shale producers have ramped up output.
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