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Global oil and gas demand to require large capital expenditures

$21.4 trillion (15.04 trillion EUR) in capital expenditures will be needed between now and 2030 to meet sharply growing global demand for hydrocarbons forecast by experts.

Larry G. Chorn, the chief economist for Platts, which provides energy and commodities information, said Monday the tab for capital spending is likely to exceed $1 trillion (0.7 trillion EUR) annually in 2016 and $2 trillion (1.41 trillion EUR) in 2026 as the industry tries to satisfy surging consumption in the U.S. and abroad.

The bulk will go toward exploration, development and maintenance of the crude oil supply, the Platts' analysis says. Refining and transportation will account for the remainder.

"The coordination and management of these projects are going to require a tremendous effort," Chorn told petroleum executives at a Standard & Poor's conference.

Already, the industry apparently is falling behind the spending curve.

The Platts model indicated a need for $350 billion (246 billion EUR) in capital spending worldwide last year to ensure adequate crude oil production in 2010, though it says the International Energy Agency reported that companies spent $250 billion (175.7 billion EUR).

It attributes the investment shortfall to a variety of factors, including the growth of state-controlled national oil companies, which limits access for multinational companies like Exxon Mobil Corp. and others.

Exxon Mobil is the world's largest publicly traded oil company, and its $39.5 billion (27.7 billion EUR) profit in 2006 was a record for U.S. companies. Yet the Irving, Texas-based company pumped just 3 percent of the world's oil last year. National oil companies, which control almost 90 percent of global oil reserves, produced the bulk of the world's supply.

Platts also cited the shortage of experienced engineers and geoscientists as hindering the development of new projects.

Paris-based IEA - an energy policy adviser for its 26 member countries, including the United States - has said global energy needs will surge by 53 percent over the next quarter century.

And fossil fuels will continue to be the primary source. At present, for example, renewable energy sources such as wind and solar supply about 6 percent of America's energy needs, according to the U.S. Energy Information Administration. That figure is expected to grow only to about 7 percent in the next 20 years, the EIA forecasts.

Many oil, refining and pipeline companies have strong finances because of the surging price of crude oil, which climbed as high as $86 a barrel Monday for the first time. Standard & Poor's says its upgrades of U.S. oil and gas companies' credit ratings so far this year have far outnumbered downgrades.

What have been record or near-record profits for some companies could mean bigger capital spending budgets.

Exxon Mobil chief Rex Tillerson has said the company is spending the bulk of its record earnings on finding and producing new supplies of oil and gas - rather than alternatives - to meet rising demand. The company has said it will invest in more than 20 new global projects in the next three years; its capital spending is forecast to be about $20 billion (14.06 billion EUR) a year through the end of the decade.

So Donald Trump referred to "shithole" countries in a meeting on immigration. Or did he? In denying the allegations, claiming that was "not the language used", while others state that was the language used, either he, or they, are lying. The bottom line is, what to make out of the "shithole incident"?

Some A**hole should shut his cakehole
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