Covid Knocks 20% Off Global 2020 Energy Investment – IEA

Energy investment is set to fall by one-fifth in 2020 due to the Covid-19 pandemic; Pre-crisis expectations of modest growth have turned into the largest fall in global energy investment on record

May 2020 (International Energy Agency)

“…[At the start of the year, it appeared] worldwide capital expenditures on energy might edge higher by 2% in 2020. This would have been the highest uptick in global energy investment since 2014… 2020 is now set to see the largest decline in energy investment on record, a reduction of one-fifth – or almost USD 400 billion…Oil (50%) and electricity (a further 38%) were the two largest components of worldwide consumer spending on energy in 2019…[But] spending on oil will plummet by more than USD 1 trillion in 2020, while power sector revenues drop by USD 180 billion (with demand and price effects accompanied in many countries by a rise in non payment)…[T]his would mean an historic switch in 2020 as electricity becomes the largest single element of consumer spending on energy…

click to enlarge

[Investment in 2020 will likely drop by one-third] in the oil and gas sector …[The power sector will likely see] a fall of 10% in capital spending…China remains the largest market for investment and a major determinant of global trends; the estimated 12% decline in energy spending in 2020 is muted by the relatively early restart of industrial activity…The United States sees a larger fall in investment of over 25% because of its greater exposure to oil and gas (around half of all US energy investment is in fossil fuel supply). Europe’s estimated decline is around 17%, with investments in electricity grids, wind and efficiency holding up…Developing countries, especially those with significant hydrocarbon industries, see the most dramatic effects of the crisis…” click here for more

click to enlarge

Tweet