Statistics Norway (SN) announced Thursday that it expects oil prices to “remain low going forward”, before increasing to around $60 per barrel in 2018.
The research and analysis organization reported that the Norwegian economy has been experiencing an oil driven economic downturn for the past year, although SN expects this drop to be followed by a modest recovery in the second half of 2016. The organization also revealed that it anticipates investments in the oil and gas industry will fall by almost 12 percent this year, and that the decline will gradually decrease in the years ahead to 5.5 percent in 2018 in a development that would see “a drop of almost 33 percent from 2013 to 2018”.
Reuters stated June 12 that data from a previous Statistics Norway report suggested the slump in investment in Norway’s oil and gas sector would level off from 2016. Reuters said that preliminary figures from Statistics Norway’s previous report showed total 2016 investments were estimated at $23.8 billion, which is 1.4 percent higher than the 2015 estimate released in June last year.
In a statement on the organization’s website, Statistics Norway said:
“Oil prices fell sharply after summer 2014, and at the end of August 2015 were more than halved. We expect oil prices to remain low going forward, but gradually increasing to around $60 per barrel in 2018.”
In a response to the decreasing oil price, a range of Norway-focused oil and gas companies have cut staff throughout 2015 including Aker Solutions ASA, Royal Dutch Shell plc, Subsea 7 S.A., Statoil ASA and Technip S.A.