Amid Soaring Oil Prices, Petroleum Industry Unites to Urge Wall Street: "Please Don't Stop Investing"

John Kerry, U.S. Special Presidential Envoy for Climate, is speaking at the CERAWeek conference held in Houston, USA, on the 7th (local time).
[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] As oil prices soared due to Russia's airstrikes on Ukraine, the oil industry appealed to Wall Street not to stop investing, warning that reducing investments would exacerbate the shock from rising prices.

According to major foreign media on the 7th (local time), executives from oil companies including U.S. oil giant ExxonMobil said at the CERAWeek energy forum held in Houston, USA, "Investors often tell us not to invest in oil companies," expressing this concern.

John Hess, CEO of U.S. oil company Hess Corporation, pointed out, "This is a crisis situation, and we must invest more," adding, "We have suffered from underinvestment over the past five years and are now paying the price." He criticized Wall Street for reducing spending on crude oil production by oil companies for years while increasing dividends.

Darren Woods, CEO of ExxonMobil, said, "Our company and the entire industry are working to maximize production," and although oil supply is expected to exceed the production targets set this year in Texas and New Mexico, the situation remains difficult. He added, "There are difficulties caused by reduced investment since the pandemic, and the Ukraine airstrike situation is making it more complicated."

Patrick Pouyann?, CEO of French energy company TotalEnergies, said, "Last year, only $350 billion was invested in securing high-grade oil and gas. This is a level compatible with the 'net-zero' scenario," adding, "Unfortunately, demand is increasing and prices are rising. This is the reality we face."

Their remarks came after oil prices hit their highest level since July 2008. On the previous day, May Brent crude futures on the London ICE Futures Exchange surged to $139.13. Although prices later fell back to the $120 range, volatility is expected to continue for the time being due to geopolitical risks and other factors.

Meanwhile, Mohammed Barkindo, Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC), expressed concern at the same event that the world does not have sufficient crude oil production capacity to replace Russia. He said, "The world does not have the capacity to replace 7 million barrels per day supplied by Russia," adding, "We cannot control what is happening now or geopolitical issues, and these situations are already dominating the market's pace."

This content was produced with the assistance of AI translation services.