IEA sees upstream spending revival

After investor confidence plummeted in the wake of crashing oil prices, upstream spending may finally be on the comeback trail

Global spending in the oil and gas upstream sector will continue to recover in 2018 as stronger prices and healthier oil demand growth encourage investment, according to the International Energy Agency. After collapsing between 2014-16 by over 40% amid the downturn, an upstream recovery that saw 4% growth in 2017 will this year accelerate to 5%, accounting for projects worth $472bn, the IEA said in its World Energy Investment 2018 Report. The US shale success story is driving much of the growth, the IEA said. Capital spending in the US shale patch is expected to increase by 20% in 2018 after a 60% jump last year, as shorter-cycle projects take precedence over offshore and oil sands ventures.