The Strategist

IEA: Global energy industry investments start to grow in 2018

05/14/2019 - 12:17

Investments in the global energy sector ceased to decline in 2018 after falling for three years in a row, and amounted to $ 1.85 trillion, which almost coincides with the figure in 2017, according to the International Energy Agency (IEA).

"In 2018, investments in the global energy sector stabilized at a level close to $ 1.85 trillion after three years of decline. The growth in investments in oil, gas and coal was offset by lower costs for the development of fossil fuel generation and renewable energy sources. Energy efficiency has not changed. And for the third year in a row, the electric power sector has been ahead of oil and gas in terms of the volume of attracted investments,” the IEA notes.

The largest increase in investment was recorded in the United States - in the extraction and development, especially in the extraction of shale oil and the development of power grids. In 2018, China became the largest energy investor in the world, but the gap between the United States and China has narrowed.

The second largest investment growth was recorded in India, while the countries of Central and West Africa retain the risks of under-financing for the energy sector.

The IEA warns that, despite the stabilization of investments in the energy sector, the number of approvals issued for oil and gas projects is not enough to meet the growing demand for energy in the world. There has not yet been a significant shift in investment towards energy efficiency and the development of renewable energy sources.

“Energy investments today face unprecedented uncertainty associated with changing markets, energy policies and technologies. But the main thing is that the world is not investing enough in traditional energy to support existing consumption patterns and new cleaner technologies to change the existing course,"- said Head of the IEA Fatih Birol.