SAFE’s Energy Security Fact Pack gives readers a data-driven overview of the latest trends in energy security, including domestic and global oil production and consumption, oil market dynamics and prices, and up-to-date information on fuel efficiency and alternative fuel vehicles.
This edition of the SAFE Energy Security Fact Pack examines the effect of low oil prices on industry and production.
Global oil prices continued to fall in Q4 2015, ending the year at $38 per barrel (bbl) (Brent), down from $48 in September. With prices now at levels not observed since 2004, the decline ranks as one of the most severe in history.
Oil price volatility remains elevated, and is likely to endure for the foreseeable future due to growing uncertainty surrounding U.S. and global oil supplies, China’s economic growth rate, ongoing conflict in the Middle East, among other factors.
Such unpredictable oil price fluctuations continue to inhibit oil companies’ planning and activities. Notably, upstream capital expenditures for both oil majors and independents declined significantly, while year-over-year (y-o-y) U.S. employment in the oil and gas sector also continued to fall. Q4 2015 witnessed a host of bankruptcies, mergers, and acquisitions in the industry.